Property valuations act as an independent price discovery tool for both the property buyer and seller. The technical intelligence of a professional valuer will provide buyers with information on the prevailing market trends regarding property prices. To a property seller, property valuation aids in defining the asking price of a property.
In Warren Buffett’s simplistic terms, “Price is what you pay, and value is what you get”. This metaphor makes it easy for a buyer or seller to appreciate the importance of a property valuation: it’s a value-for-money benchmark in report format.
With a property valuation report, one can negotiate for the best deal. Valuations make use of various property characteristics, including its location, age, condition, renovation potential, and various other factors.
According to www.propertydome.com California-based Donald Bren remains the wealthiest real estate billionaire in the world with an estimated US$15.5 billion net worth. Bren’s property investments
have withstood global recessions and pandemics, including Covid 19. It is this resilience that makes property investments unique. However, without professional valuations and advisory, Donald Bren’s property portfolio would not have gone this far.
Besides buying and selling decisions, you should get your property
valued for one or more reasons below.
From a valuer’s perspective, rental income is linked to the property’s value. Annual rental income for a property should exceed 6% of its market price. In other words, property valuation will give you a
competitive rent for your property from tenants.
In Zimbabwe, properties attract various taxes, including municipal tax, ground rent tax, and capital gains tax upon sale, to mention a few. To calculate these taxes, government departments take into
consideration the estimated value of the property. This tax linkage makes it important for you to know the market value of your property.
Lastly, because your property is a store of value, financial institutions accept loan requests from buyers against their property as security. For the mortgaging to happen, a property valuation must be done to
give an estimated price for the property, which will in turn influence the amount of the loan.
In conclusion, property investments have remained a safe haven for investors owing to their many inherent benefits, including the ability to generate passive rental income, diversification potential, stable
cash flow, tax advantages, financial leverage on mortgages, and property value appreciation, to mention a few. These advantages can only be fully exploited if property buyers and sellers engage the services of a professional valuer who understands the twists and turns of the property jungle.
