Valuation Report of a property is one of the most important documents while selling your property. The Valuation Report evaluates the particular property. It helps both the buyer and the seller in knowing the value of the property. This document helps in negotiating the price to be paid for the property. If you are getting a loan from a bank in order to purchase the property, you will have to submit the valuation report to the bank. This is required by the bank to ensure that even if the loan amount is left unpaid, the outstanding amount of the loan is covered.
Valuation Report is required during the purchase of the property to ensure whether the purchase price is reasonable. This is also required for the tax purpose. Property owners who own property above a certain value are required to pay their property taxes.
There are a number of factors that determine the value of the property to prepare a valuation report. Some of them are:
Location of the property:
The Value of a property mainly depends upon the locality of the project. Properties located in well developed areas and areas with well developed infrastructure has a great value. Properties located centrally in the city also gets a greater value.
Age of the Property:
The age of the property is also taken into account while preparing a Valuation Report. Generally, newer properties command a higher price when compared to the older ones.
Value of similar Properties in the locality:
When a surveyor accesses the value of a property, they will consider the range of values, past and present, achieved for similar properties in the neighborhood. This serve as an important benchmark in determining the value of a property. The government value of the property and the cost of construction of the property are also some of the important factors in determining the value of the property.
The valuation date should be specified in the Valuation Report. This is very much important because the value of the property mentioned in the valuation report is only valid for a given period of time.
All the assumptions, conditions and restrictions that were taken into account while preparing the report should also be mentioned clearly in the report. It should also specify for which reason the report was generated. This helps the users of the report make necessary adjustments and to take an informed decision. For all the above reasons, Valuation Report of a property is an important document while selling a property.