Avoid these common mistakes
There are so many common mistakes people make when valuing a property, we’ve compiled them below:
☑️Being led under the wrong influence of agents—Don’t get influenced by the real estate agents. Their main purpose is to sell the property and they will try their best to do so by only sharing a part of the whole truth. Gather information from various sources and don’t just rely on the agent.
☑️Doing the wrong comparison—People normally don’t consider the size, location, quality of property when comparing properties, which makes it difficult to value a property accurately. As discussed, make correct comparisons by keeping all the factors in mind.
☑️Making emotional decisions—This is a big NO! Don’t get emotionally attached to the property you want to purchase as you might end up paying a price much higher than the market value.
☑️Listening to the media—The information provided by the media is not reliable. Its main focus is to sell the news. Instead of seeking information through media channels, visit platforms such as CoreLogic or Residex as they provide real-time information based on actual statistics and facts.
Keeping all these points in mind will help you value a property more accurately and put you in a better position to make a well-informed decision.
Determine the Property’s Value
As with rental, working out your future home’s value is not an exact science. Ultimately the property is going to be worth the highest amount someone is willing to pay, but you can at least get an indication using the same techniques real estate agents use to price properties.
To determine a home’s value, you need to look at recent sales of similar properties with these characteristics:
1. The sales within 2 km of home, in the same suburb
2. The same property type (unit/house/townhouse/land)
3. The same number of bedrooms, bathrooms and car parks
4. The same, or similar land size
5. The sale occurred within the last six months
6. Property is in similar condition/has a similar level of improvements (i.e. both have a pool, renovated kitchen, etc.)
The last point is where your research can get a bit subjective but try to take a step back and look at it as an external investor would.
Method #1: Confirm the Property’s Value with a Free RP Data Valuation (easiest and best method)
1. Go to our Contact Page, input your details and in the message include the property address.
2. We’ll complete a free RP Data electronic valuation for you (sample here), which will do all the work for you
3. The report includes location highlights, recent sales and properties on the market.
4. Most importantly it includes an estimated value and estimated price range.
Method #2: Researching property values using SoldPrice (best DIY method)
1. Go to SoldPrice website, click ‘Home Sold Price’.
2. Enter your suburb.
3. Set Search filters criteria, in our case a minimum three bedroom, minimum of 300 sqm land and property type as a house.
4. Review and shortlist results. Add commentary to your results.
Method #3: Researching property values using CoreLogic (okay DIY method)
1. Go to PropertyValue website, enter the address in the box.
2.The website will generate an automated value figure, $870,000 to $1,099,999.
3. It gives confidence of the estimate, in this case, it’s high.
4. You can also see other properties on the market at the bottom, to give you a sense of where you sit.
Method #4: Researching property values using RealEstateView (worst DIY method)
1. Go to RealEstateView website, enter the address in the box.
2. It gives you an estimated value, ignore this at the moment.
3. Scroll down to ‘82 Charlotte Street Price Estimate’ and click ‘Choose your comparable sales’
4. Keep clicking, replace comparable until you get three sales that match our criteria above (same suburb, the same type of property, etc.