The method of evaluating the value of a property is not always perfect. For those who do a self valuation on their properties, it is possible that you may not arrive with an accurate value.
Common Mistakes in Self Home Valuation
1. Comparing With Properties for Sale in the Market
In this situation, the value that you will get is not necessarily the agreed price of the property. This can be the amount the seller is willing to offer. Unfortunately, some sellers have unrealistic values attached to their properties. The selling amount is not necessarily the amount a property will be sold.
2. Being Influenced by Real Estate Agents
A real estate agent may or may not be telling the truth about the value of a certain property. You can never be really sure. It would be ideal to rely on comparable sales only and not about what agents tell you about offerings on properties you would want to compare with.
3. Not Comparing Eye to Eye
Be sure that the comparison that you are making are indeed truly comparable. You cannot compare an orange with an apple. A 4 bedroom property with a pool is so far from a 3-bedroom home with a garage even if they have the same land area. If you have such a unique property, it would be quite hard to compare it with other properties in the market.
4. Comparing with Emotional Attachment
When you are selling your home, there is a certain emotional attachment that makes it difficult for you to put a price tag on your property.
Meanwhile, buyers can sometimes fall too much in love with a property and end up giving a overm market value bid in order to secure their dream home.
5. Not Knowing the Market
It is advisable to go to as many open homes and auctions in your dream suburb as well as nearby areas to be able to understand the market. Experience counts a lot in knowing how to put a price tag on a property. Going to such auctions and open homes also gives you an idea on which locations are superior over the others.
5. New Properties Can be More Expensive
New properties are appealing to buyers. Some people are even willing to pay premium prices for brand new properties. Also, government incentives are provided in new property purchase. However, this tends to inflate demand, making these properties appear to be worth more than they actually are.
6. Listening to the Media
Australians love to read about property. The media capitalises on every possible story and new statistics that comes from “experts” that either proclaims prices to plummet or skyrocket.
It is still advisable to ask a professional to perform a property valuation.