Real estate price versus value
THE legal term for the purchasing or selling of property is conveyancing. However, it is more intricate, as it entails the act of preparing the relevant legal documents for the transfer of legal proprietorship of the property or land from one person to another.
In conveyancing a property via sale, as the purchaser consider the price of the property and the value the property to you.
THE ART OF NEGOTIATION: PRICE VS VALUE
When approaching property dealings, it is important for both the vendor and the purchaser to know their bottom line prior to entering into negotiations, as further into the process, either party may feel as if they have gained the least from the agreement.
It must be clearly stated exactly what is being sold. Thus, giving the purchaser the opportunity to evaluate whether the price quoted matches the value of the property.
This simply means the value of a property is not relative to the price determined by the vendor, but its significance to the purchaser. The value is dependent on the location, the ambience, the purpose for which the property will be utilised (for example, raising a family, farming or other business ventures), and the sense of contentment it gives the purchaser.
The value will vary based on the needs of the purchaser, therefore, once the property fulfills their requirement, the value would have been established. Therefore, consider is the property located in a suitable area? Is the property in a reasonable condition? At this juncture, the purchaser can easily decide whether the property is worth the price.
Importantly, the price being asked by the vendor will be that agreed by the vendor and the purchaser and not necessarily the original price for which the property was listed or the actual market value of the property.
Prior to agreeing on the purchase price, the purchaser should ensure that an independent valuation of the property is conducted by a certified valuator to determine it is not overpriced.
At this juncture, having considered both the amount being asked and the value, the purchaser can easily decide whether the property is worth the price and can knowledgably and reasonably negotiate.
Rashema Gordon Morgan is an Attorney-at-law who specializes in conveyancing, probate and civil matters. Rashema may be contacted via email rashema.gmorgan@gmail.com or telephone 876-370-1915. This article is for general information purposes only and does not constitute legal advice.