While the two terms might be synonyms in the dictionary, a property valuation and a real estate appraisal are different kinds of documents. And just to keep things interesting, a real estate appraisal can also be known as an evaluation — yet another term entering the mix to keep things slightly confusing.
So let's clarify matters. We know your main goal is to quickly ascertain what your home is worth today. This is essential information you need in order to make key decisions about the future of what is likely your biggest investment. So here is a quick glance at the property valuation process and how it differs from an appraisal.
Phase one: appraisal
If you are in the early days of thinking about selling your home, or simply want to determine if it is worthwhile to invest in upgrading your space, an appraisal is the appropriate starting point. A real estate agent, including those of us at Ray White Surfers Paradise, can generate an appraisal report in a short time. It is an unofficial estimate, based on a review of your home and how it relates to nearby properties which have sold in the last several months.
An appraisal can provide useful information but isn't a document that can be cited in legal or financial dealings.
Valuation: an official, closer look
While the appraisal is a studied but unofficial look at your property, a valuation is an official document prepared by a licenced valuator. This document will take longer to compile and source many more data points than an appraisal. It will look less at cosmetic facets of your property and more so at concrete factors such as the number of bedrooms and amenities like a pool. A valuation will also take into account many of the same considerations as an appraisal, but expand to include:
It can be used by financial institutions, such as a bank issuing a mortgage loan, and in legal proceedings such as a divorce or in settling an estate after a death in the family.
When it comes to homes up for auction or private sale, a property valuation offers benefits to both buyer and seller. Sellers can look at the valuation with an eye on DIY opportunities or other more involved remodelling projects. Buyers, meanwhile, can look at the valuation closely to decide if they want to make an offer.
Yes, the process of selling a home is likely new to you, or perhaps it's been a while. Let the team at Ray White Surfers Paradise can assist you all along your path home, even as you work with valuators. If you'd like to know more about how we can be of assistance, please reach out today.