How is a property valued?
A home is often a person’s biggest financial asset and selling it at the right price is crucial if one is to make it work to future advantage.
According to Steven van Rooyen, Principal of Leapfrog Property Milnerton, the challenge lies in evaluating the property’s value correctly.
“Undervalue it and the seller loses financially, overvalue it and it won’t sell,” said van Rooyen.
But how does one determine the true value of a residential property?
Van Rooyen said a property valuation is based on a number of factors.
“A professional estate agent will be able to determine the value of your property based on its size, location as well as by looking at what similar homes within the area are selling for.
“Ultimately the property is only worth what a willing buyer will pay a willing seller”.
“At the moment we’re experiencing price resistance due to this and other economic factors and sellers who have inflated their asking prices are finding that their homes remain on the market much longer”, he explained.
He believes that most of the price growth expected for 2015 has already been achieved and that prices will likely not increase much further towards the end of the year.
“That being said there is also no need to make the opposite mistake, by undervaluing a property.
“My advice to sellers is not to be misled by emotion – trust accurate market evaluations from respected agents and let that determine your sales price.”
He cautioned sellers and buyers to educate themselves on the market value of properties in a particular area so as to make the most informed decision possible when it comes to either selling or buying property.
This can be done by working with a trusted property advisor and relying on their CMA (comparative market analysis).
