The property valuation process is a structured approach used by qualified valuers to determine the current market value of a property.
Here’s a step-by-step overview of how it works:
1. Instruction and Scope
The process begins with a client request outlining the purpose of the valuation—whether for sale, purchase, refinancing, legal matters, or investment. The valuer defines the scope of work and ensures compliance with relevant industry standards.
2. Property Inspection
The valuer conducts a physical inspection of the property. This includes assessing the land size, building structure, layout, condition, renovations, and any unique features. For commercial properties, rental income and lease agreements are also reviewed.
3. Market Research and Data Collection
The valuer gathers data on comparable sales, recent transactions, and current market trends. They also consider zoning regulations, planning restrictions, and the property’s location in relation to amenities, infrastructure, and economic activity.
4. Valuation Method Selection
Depending on the property type and purpose, the valuer chooses an appropriate valuation method. This may include the comparable sales approach, income capitalisation method, discounted cash flow analysis, or summation method.
5. Analysis and Calculations
Using the chosen method, the valuer performs detailed calculations to estimate the property’s value. Adjustments may be made for differences in features, location, or condition compared to similar properties.
6. Report Preparation
A comprehensive valuation report is prepared, outlining the methods used, supporting data, findings, and the final assessed value. This report is legally recognised and used by banks, investors, legal professionals, and property owners.
7. Client Delivery and Support
The report is delivered to the client, and the valuer is available to clarify findings or provide additional guidance.
This systematic process ensures a fair, accurate, and reliable property valuation.
