When it comes to buying or selling a house or any other property, it is always important to figure out its real value. The reason is that you get an accurate measure of the value of your property or one that you want to purchase. In an open and highly competitive real estate marketplace, it becomes necessary to evaluate your property so that you do not undervalue or oversell it. This will help you achieve a successful real estate transaction.
When you order a property valuation, you get a lot of essential information about your property. This includes things such as building and land sizes, current market rate, structural conditions, as well as any physical repair and maintenance needed. If you are looking to sell it, then valuation will give you a deeper insight into comparative sales in your region. It is important to work with a licensed professional because the law holds them accountable for the information and reports they produce. The most common reasons to get your property evaluated include:
1. Mortgage Refinancing
In most cases, your lender will want to evaluate the property you took a loan against. The reason behind this is that your primary loan term may be nearing a close, or you want to switch lenders or loan products.
If you are switching loan products, you will be in a better position to negotiate the changes if your loan-to-value ratio is more than 80%. This information is indicated in your property valuation report.
2. Expanding Your Investment Portfolio
You can use your primary residence as collateral when looking for a loan to buy investments and assets. This is because property is a strong form of equity. The biggest advantage here is that most financial and lending institutions are ready to lend you more than 80% of the purchase price when you use your primary property as collateral. Conducting an evaluation for your property lets you know the state of your home equity. This will then inform your decision to either build or diversify your portfolio.
3. Better Financial Decisions
Because of the fast-rising cost of living in most countries, it is very easy for you to feel overwhelmed. It is highly likely that your financial situation and general economic well being will make you worry about your future. However, this does not have to be the case. The good thing about real estate is that, depending on market trends and property improvements, it will appreciate in value over time.
This means that when you value a property, you will know the value it holds for your future. Going forward, it will give you the ability to make sound financial decisions and peace of mind.
4. Find Hidden Problems
Most of the problems a property can have are relatively obvious. Water damage, cracks and holes in the wall, and more will all be visible. That doesn’t mean all of them will be as visible, and some of them could be lurking beneath the surface. Asbestos is one of the more notable.
With the risk of asbestos dangers in America, it’s worth being aware of them so they can be fixed. A property evaluation helps you find these, so you can then address them. There’ll be no problem finding out about anything lurking beneath the surface.
5. Justifies Renovation
Before undertaking any form of home renovation, it is important to know the actual value of your property. This is why valuation is necessary. When you know the value a property holds, you will make more informed decisions when it comes to making improvements. This is because it will determine the resale value of your asset.
For example, if your valuation report indicates that you own a low-value property, then it would not make sense to install a high-end swimming pool. On the other hand, a higher-value house requires much more sophisticated and polished modifications.
6. When Selling
When you actually want to sell a property, it is important to get it evaluated by a licensed professional. This is especially important if you are thinking of a quick sale because you will not have the time to stage your home for potential buyers. A valuation report will give you a realistic market rate that will boost your chances of making a sale.
