The Gold Coast property market is strong. When the market is strong and the sales data is lagging, in our experience contracts crash more often. There are really only three reasons a contract won’t go through. A bad pest and building will do it although some minor issues can often be negotiated away. The cost of mortgage insurance can be an issue if the buyer doesn’t have a 20% deposit although there are lenders who will work their way around the problem.
The third big reason is that the property won’t value up to the purchase price. Valuers sometimes get broad instructions from a bank or other lending institution about how they should treat a suburb or postcode where the bank is overweight in mortgages, or about how conservative they should be in assessing a likely selling price.
When it comes to getting your valuer’s opinion up to the contract price you cannot always blame the valuer. In many cases the fault lies with the sales agent who hasn’t assisted the valuer conducting the valuation. Valuers have heavy workloads these days so the more information that isn’t available in the public record that you can provide to the valuer, the better.
Most valuers are hungry for details of unconditional contracts for similar properties that aren’t part of the public record yet. Over the years we have seen too many times that when there is a strong market, an unprepared valuer has squashed a sale leaving a buyer with shattered dreams and most probably paying more for less house in the future.
Based on our years of experience in the area these are some of the things you and your agent can do to avoid a below-market valuation.
1. Ensure the property is ready for inspection. Valuers are just like buyers - they will be influenced by the presentation of the house, even if it’s only subconsciously. They, just like buyers, know that the furniture is not going to stay but at the same time they can form a negative or positive opinion about the property. If it’s a new property, try not to have a valuer at the property until it is finished.
2. Provide valuers with a valuation pack In this pack it's important to include not just comparable sales, it should also include every unreported sale that you know of that’s comparable to the property. If it’s new have a list of detailed inclusions, overview of the building and facilities, background on the developer and work they have done recently (showcasing their work).
3. Make sure somebody walks the valuer through the property This is so the important aspects of the building can be highlighted (they are not always obvious), to answer any questions the valuer has and to provide any feedback if the valuer is having any issues with the valuation report.
4. Make it a good experience In our experience valuers are always on the run - make sure you have the keys with you and you come prepared, don’t over talk and don’t stuff up their day. While this one may not mean the valuation will be favourable or meet the contract of sale price, it will go a long way to assisting the valuer doing their job and ultimately help the most important person in the process — the purchaser.
by David Hamilton How To Get An Outstanding Valuation
palmbeachfn.com.au October 2016
First National Palm Beach
15 Palm Beach Ave Palm Beach, Queensland 4221
Phone: 07 5559 9600