There are different values which can be assigned to a residential property.
“The municipal valuation is a general rough estimate used by the municipality in order to calculate rates and taxes. This valuation is only changed once every few years, so it is not very accurate,” says Trevor Sturgess, Seeff’s MD in Kibler Park.
“The market value is the value looked at when listing a home and is determined by using a comparative market analysis," says Sturgess.“Then there is the insurance valuation. This value is based on the square metre size of the home and what it would cost - at current building costs - to rebuild the whole house if it had to burn down. This valuation is always very high and not indicative of the market value.
“The market value is the value looked at when listing a home and is determined by using a comparative market analysis - this is when estate agents compare what other homes in the immediate area have sold for. Only homes that have been sold are considered, because those that are still on the market are often terribly overpriced and not an accurate reflection of market value at all.”
Last but not least, Sturgess the general condition of the house needs to be studied. Ask questions such as:
- Has the home been well maintained or not?
- How big is the home?
- How old are the finishes in the kitchens and bathrooms?
- Does the house need a good paint?
- Are there carpets or tiles?
- How old are the tiles?
- Is there a swimming pool?
- Is there a double garage?
- Is the driveway paved?
- Is the security good? Consider security measures like burglar bars, gates, alarms, perimeter walls, palisades, electric fencing and razor wire.
- How do the wooden rafters outside, under the roof look?
- Is the garden neat?
Sturgess says a good estate agent will never try to dictate the value of a home, but will rather show the prospective seller, using a comparative market analysis, what has recently been achieved in the immediate area to guide the seller in determining a fair listing price.
The banks also look at these exact same sales figures as one of the criteria to finding value and granting bonds.
Banks will not fully finance an overpriced property, and the buyer will then need to pay in a very large deposit.
“Using a good, local, area expert remains the most important factor to selling your property at the best possible price, in the shortest time possible,” says Sturgess.
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