It’s vital to understand the difference between Market Appraisal and Property Valuation. However, it’s also just as important to know that market prices aren’t static. In other words, the market prices aren’t cast on stone, so they fluctuate over time.
Why do you need to understand the behavior of market prices anyway?
Well, it’s because the knowledge helps you to compare a specific property with a similar property that are within the same location. It is good to note that no two given properties can be identical. So, what does that mean?
It means that the appraisal is an opinion given as per available data within a specific time. In other words, the evaluation is a subjective exercise.
Market Appraisal & Property Valuation Difference
Now, it’s time to ascertain the difference between a market appraisal and property valuation.
A Market Appraisal lets you know how much your property would cost on Canberra’s current market. A Property Valuation, on the other hand, is a legal value you can use to acquire some money through your bank.
You will need to get a market appraisal from estate agents. It’s therefore advisable to source for appraisals at no charge form Real Estate agents when you want to sell your home.
How do you settle on a market appraisal from these estate agents? Get as many market appraisals from estate agents as you can. It is you who will do the shortlisting anyway, so have as many as you can handle.
However, there is one thing. Make sure that the agents you shortlist provide their valid appraisals and recommend a listing price as well.
Do you know why you must be keen on the listing price? It may surprise you to know that the value of your house varies according to different agents.
Sometimes, the appraisals will come in a small price range. If that happens, you may easily conclude that the value of your house is very much accurate.
Nonetheless, the market appraisals given by agents may vary significantly. And that’s where there is a fix. It becomes challenging to ascertain the precise value of your home if the appraisals are not close enough. It even becomes difficult to settle on an accurate estimate given by the estate agents.
There is a reprieve, however. There are other known and approved methods of knowing the value of your house if you’re confronted with such a dilemma.
Besides the market appraisals, you can arrive at the value of your home through:
- Property valuations – Independent valuers can do this
- Estimates – Numerous online sources provide a home valuation.
Why it’s essential to go for valuation rather than an appraisal.
Valuations become essential when a specific value is needed for a particular purpose. For example, in a case where there is a dispute resolution or a property settlement, you will need to get an absolute value for the said house or home.
Unlike with the market appraisal, a valuer takes into account many factors before coming up with your property’s value. They will most definitely look into the physical location, building structure, zoning, and planning restrictions.
Real estate appraisal pays no attention to the style of the house or the street appeal. Further, they don’t also liken your home to other similar homes within the market at a given time.
How do you determine market appraisal?
As earlier mentioned, market prices keep changing from time to time. Therefore, ideal way of doing a market appraisal is to compare the property with other similar properties that have sold in the previous months.
It is vital for real estate agents to have extensive knowledge of recent property transactions. The information should help them to estimate the selling price of your house. They will do so by comparing recent sales of similar properties.