One of the most common questions asked by property owners is what are the differences between a market appraisal and valuation? It sure is common for people to think they are the same thing, In fact, in some ways they are identical, however, the reason for obtaining one or the other can be the deciding factor that differentiates the two.
A licenced real estate agent offers a value estimate on the property. This is based on the knowledge of the local market using comparable sales and is usually provided in a price range format, this is called the market appraisal.
Real estate agents appraise properties generally for owners who are selling or leasing to gain an understanding of where their property sits in the current market. A series of similar recently sold or leased properties are used to demonstrate the fair market value for the property owner.
A property valuation on the other hand is conducted by a registered valuer. This type of valuation presented is a certified legal document and is not normally needed for property owners keen to know their property value, self-managed super fund, accounting or selling purposes. A valuation is usually needed by lawyers for court purposes, government agencies or banking when you are getting a loan approved.
Both the licensed agent and certified valuer are experts in their fields and aim to provide a non-bias opinion on a property’s fair market value. Often valuers will contact licensed real estate agents to get their most recent market information. So depending on what your circumstances are you may just need a licensed agent for appraisals or SMSF compliance purposes or you may need to engage a valuer for more formal reasons.
At We Value Property, our services include residential, commercial and industrial property appraisals. Our experience also accommodates commercial lease appraisals, property sales, acting as buyer’s agent and property consultation.