A value for your biggest asset
by Andy Bryenton
It’s an odd truth that you know exactly how much the bottle of orange juice of the chicken salad sandwich you bought for lunch yesterday was worth, but that you may be out by tens of thousands if asked to guess the value of your own home.
If you own a home, it’s likely to be your biggest asset, and when the time comes to sell, a realistic figure to attach as a sale price is of prime importance. Too low, and you’re swindling yourself out of revenue. Too high, and you’re potentially looking at a long wait to sell.
How can one be sure that internet-based values, or those coupled to your rates, are up to date? The current wisdom is to consult several sources, before talking to a real estate professional about a firm price.
The four core sources of a home valuation are online services, the Rateable Value or RV, a close look at the prices recently paid for similar properties, and, most comprehensively, a valuation by a qualified valuer. The first of these is easy, but can prove a little inaccurate; take a look at sites like qv.co.nz, homes.co.nz or Trade Me’s property insights. Values can vary between these sites, and they all use different criteria to arrive at a round figure. By comparison, the RV (formerly called the GV) of a home is based solely on what the local council can charge in rates. The Rateable Value is recalculated every three years, and the market can move more swiftly than that. Neither of these methods takes into account improvements you may have undertaken, or can see inside your home.
The prices paid for homes around yours may provide a good indication of where the market is at and where it’s going, but once again, this only works to the extent that homes are homogenised. If you have the best house on the street, a more modern design in an old-established neighbourhood, or conversely a heritage villa amid 1980s prefab homes, your valuation will buck the curve. Interior decorating and other upgrades are also a big factor. Perhaps the best way to go, to nail down a suitable price, is to talk to the experts. A professional valuer will cost, but their opinion is based on experience and takes everything into account, often down to the last light fitting or freshly painted deck. If you’re serious about selling, your real estate agent will walk you through the best way to arrive at a price, and will then work hard to ensure that you are remunerated for what your property is really worth.