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Here’s the thing: If you are looking to sell your house, getting an accurate valuation is crucial. Selling your house, especially if it’s your first time, can be an overwhelming task. With so many factors influencing the value of your property, getting an accurate and realistic valuation can prove to be a challenge.

You can overcome this challenge by educating yourself about the factors determine the value of your property. For starters, let’s understand what valuation of a property entails.

What does valuation of a property mean?

Valuation of a property is generally done when it is either being bought or sold. It is the estimated selling value of a property. Valuation of a house is a complicated procedure that takes into account various tangible and intangible factors.


Valuations can assess the bank or market value of your property.

While performing a valuation of your house, keep in mind that there may be two different types of valuations. The bank value of your house may differ from the market value. For you to be able to sell your house for a good price, it is important that you understand the difference between the two.

Bank valuation of a property is purely dependent on numbers. Bank valuation for a house tends to be lower than the market value, due to its tendency to be objective and conservative. Market valuation of a property, on the other hand, is what the market is willing to pay for your house.

Let’s examine the factors that determine these values.

What are the factors involved?

As mentioned before, the bank value of a property is solely dependent on numbers. The market value of a property, on the other hand, is driven by how people feel. This is not to say that the market valuation completely disregards the basic numbers involved in the computation of the property’s value.


Many criteria are evaluated when calculating a property’s value.

The basic factors that determine the value of your property are listed below.

1. Size of property

One of the biggest factors determining the value of your house is the size. The more surface or floor area your property has, the higher its value. While doing a valuation, make sure you obtain the accurate measurements of the house.

2. Type of property

Different types of properties sell at varying rates. The value of independent houses is calculated differently from the value of apartments.

3. Age of property

The age of your house can be a big factor in determining its value. But keep in mind that this is not a factor that only goes one way. The way people feel about the age of the property can vary. Generally speaking, people tend to prefer newer houses, but if the age of the house adds to its overall charm it could serve as a positive influence in its valuation.

4. Accommodation available

The number of rooms in the house also plays a big part in its value. In most cases, the more the number of rooms, the higher the value of the house.

5. Fixtures and features

The types and quality of the fixtures in your house add quite a lot of value to it. The better the fixtures, the more value they add to your house.

6. Construction and state of repair


The condition and craftsmanship of a property can increase its value.

The style of construction and the state of the house also affect the valuation of a house. A well-built house is likely to be more sought after than a poorly constructed house.

7. Locality and surrounding amenities

The location of your house is one of the driving factors in determining the value of your property. Places with close access to all types of amenities tend to be more valuable than places with lesser amenities. Places with close accessibility to public transport systems, schools, and city centres tend to sell for a higher price than places that are on the outskirts of the city.

8. Buyers in the market

How much your property sells for may also be influenced by the emotions of buyers in the market. For example, in auctions, buyers may get carried away with the desire to “win” the auctioned item, and end up paying more than the actual price due to the competitive environment.

Some buyers may also end up paying more for a property due to the fear of losing out on it. When buyers really like a property, the value of the house increases due to the emotions they attach to it.

Why is it important?

Determining the value of your property can be a difficult task, but it is an important one. It matters because you might get paid lesser than what your property is worth if you get it wrong. But on the other hand, if you cite a price higher than your property’s value, it may not sell at all.

Getting an accurate estimation of your property will help you decide the minimum amount you should be selling your house for, so as to not incur a loss. This will also help you decide how much profit you made with the sale if you sell it for a higher price.

How to get a valuation of your property?

Getting the best value for your house will be easier if you keep the following things in mind.

1. Get the basic numbers in line

Getting a bank valuation can be helpful at this stage. Start with an assessment based on factors like size, age, construction, and features first.

2. Check out the competition

After you have calculated the minimum value of your house, do some research on the pricing of the houses around the same locality. This will give you a fair idea of how you should go about determining the market value of your own house

3. Get a professional opinion

Getting a real estate expert’s opinion on the valuation of your house may give a more accurate and relevant price for your house. Real estate experts run a comparative market analysis by comparing the sales of similar properties in the past 90 days. This helps them set a baseline for the pricing of your house.

Real estate valuation experts also perform a detailed analysis of all the features and fixtures in your house to determine how much value these add to your property.

Tips for selling your house for a better price

Houses in poor condition or with damaged features and fixtures tend to depreciate the value of the property. Check if your house needs fixing before you put it up in the market.

Even fix-uppers can turn a fair profit with some work.

Ensuring that your house looks fresh and well-maintained can truly help you get the maximum value for it. Invest in getting your house repainted and thoroughly cleaned before showing it to any potential buyers.


After you put your house up for sale in the market, take your time and compare all the offers that you receive. Remember, buying a house is influenced by emotions and you could get more value if buyers in the market are bidding at competitive prices.


Conclusion

Determining the value of a property isn’t limited to sale. It’s just as important when you’re planning to purchase a new property. The same do’s and don’ts apply when you’re buying a new house as well.

Once you’ve received the valuation and are happy with the results, you may consider buying the home. In this case, it’s good to expand your research to various home loans as well. You can also compare your options on various websites or use tools.

This article is a contribution by Lingan Rao of BankBazaar.

Do you think that that valuation of a property is a must? Let us know below.

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Market value not necessary is higher than bank value, given the current market situations, certain area/segments the market value could be lower than bank value as there is no takers for a very long time