Rage against my valuers

13/03/2012


Question: I own a Sydney property, but there seems to be no consensus on its value. I’ve had multiple professional valuations done and they’ve returned figures that differ by as much as $100k and no one’s explained why. How come these valuers can’t be made to justify their “professional” opinion?

 

Answer: When a valuer is retained by a bank to perform a valuation on your property, technically speaking, the bank owns that valuation.

Under privacy laws, however, the bank is required to give you access to that written valuation and to the valuer who performed it.

Although the banks do not advertise this, you can apply to them, in writing, to receive a copy of the valuation.

Many valuers receive a high proportion of their work from being ‘panelled’ valuers – that is they sit upon a panel of valuers from which the bank will make a choice when ordering a valuation in your area.

The bank is continually assessing this panel and will frequently remove valuers from it.

Banks are particularly averse to valuers they perceive as too enthusiastic. These valuers often return higher valuations, and since these figures govern the amount of money lent out, they are often the first to be removed.

This makes bank valuers understandably cautious when it comes to valuing a property and its not uncommon for them to return an assessment that is 10% under a property’s true market value.

You can query this, and as long as you can gather significant evidence that the price given is too low, you may have success in getting the valuer to increase their assessment.

Before you do this, it’s probably a good idea to first learn and understand the criteria that guides a valuation. Many people simply look at listings in their area to determine market value, but this is rarely an indication of what the market will pay.

What does affect your valuation is how your property compares to other similar sized properties in your area that have recently sold in the past few months.

This is then weighted only slightly by how your property is presented. Aesthetic improvements add little to market value, so while your property may appear better presented than others, this rarely impacts its ultimate value. 

If you can prove that other properties with the same dimensions as yours sold recently for a significantly higher price, then you may have a case.

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