Many states have new underquoting reforms coming into effect, so agents may find themselves in a greater challenge and more stressed when it comes to determining an estimation for property value. If your property value estimation is not near the value the vendor is wanting, you could find your job jeopardised. However, if the estimation is too high, you could find yourself in an awkward spot with the vendor and the buyer both when the day for the auction arrives.
With our clear outline, we are giving you three options you can justify your property valuations effectively while also convincing both vendors and buyers of the property’s actual value.
Use the Data to Your Advantage
As an agent, one of the best tools you have is a lot of data. This data may have price listings for comparable properties, influential factors impacting the worth of property and more. You will have to explain this data in complete detail to both buyers and vendors in an understandable way so there is no misrepresentation.
For example, if a property that neighbours the property in question sold for a specific price and your vendor believes he or she can get more, you should draw the relative size comparison and covenants and make sure it is being compared accurately for a fair estimation of value. There are several websites that are valuable tools for showing sales data and statistics to clients so you can help substantiate your property valuation, such as onthehouse.com.au, Property Value and Your Investment Property.
Highlight the Best Assets of the Property to Draw Interest
Every property has its own best assets. Market interest is important in revealing a property’s true value. You can achieve market value by having more than one buyer. This will allow them to compete for the purchase outbidding each other. The market price is set when one person bails out after the other sets the price at an amount they view as too high for the maximum worth.
Two or more bidders who are highly motivated are needed to help you achieve market value. The home needs to have its kerb appeal, be tidy and clean, well marketed and staged to perfection to garner interest. Jot down three features unique to this property during your first inspection so you can share them with interested parties. These features may be the proximity to stores or schools, recent renovations or state of the art kitchen appliances. To drum up the highest level of interest, mention these items in your sales pitch at inspections.
Convenience is Important
Traffic problems are worsening, so living near schools, shopping, amenities and public transport system will help boost a particular property up higher on a homebuyer’s wish list. If a listing is near desired things, include that into the property’s valuation in regards to what the added convenience will worth in the daily activities of a potential homebuyer.
When determining the valuation to establish an asking price, make sure vendors are shown the walkability. Show them the walkability report and the given address’s walk score from walkscore.com. Walk Score has up to a rating of 100, which means 100 is a walker’s paradise because of easy accessibility to the close amenities.
State the Facts, Don’t Let Emotion Step in the Way
Unfortunately, many people can’t understand the value of property because they let their emotions and sentimental value to their home or property. They think the work they did themselves is much more than it would cost if you had paid to outsource it.
Be straightforward and honest in your explanations, if any work was outsourced you need to clarify that and the costs that were put into the project if it is added to the sale price of the value. You want to make sure the reasonable and best price is set for the property, regardless of the memories that you made there. Your emotions have to be kept out of the valuation.
Check out our blog for more helpful tips and information. You can also follow us on Facebook.
At iProperty, we provide leading online property management and real estate software, responsive websites, and more.