The nitty gritty of virtual valuations
With industry players continuing to rally and adapt so that property professionals can still service their clients, the latest new measure are virtual valuations. While this is an excellent solution, there are a number of factors both sellers and agents should be aware of. Yael Geffen, CEO, Lew Geffen Sotheby’s International Realty, says virtual valuations are an excellent solution to the problem, as most of the process can easily be done remotely. “However, we only advise agent-led virtual property valuations. Anyone can ask you to fill out an online form and spit out an automated result.” She says the basis of an evaluation is a standard calculation using data from the deeds office – which reopened on Wednesday – and resources like Lightstone to determine the average sale price of similar properties in an area during the past three to six months. “The information needed for an agent to make a general comparison can be gleaned from a comprehensive questionnaire that the seller completes. However, not all homes are equal as some will have been renovated or upgraded, while a similar house in the same road may still be in its original condition, which is where clear detailed photos and video walk-throughs are necessary,” Geffen says. Sellers may understandably feel unsure about exactly what essential information must be included and concerned that there may be loopholes which can cause problems at a later stage of the transaction, especially if critical information is omitted. “That’s why an agent partnering with you in completing the virtual valuation is crucial – the devil is in the detail,” she says.
More is more
According to David Dewar, director, Thomson Wilks Attorneys, Notaries and Conveyancers, the rule of thumb is to err on the side of caution and give as much information as possible. “It’s the unspoken that will affect the final value and, without being on site, the agent cannot inspect those aspects for themselves, so it would be wise to make the valuation range a bit wider than normal.” She says agents must also ask for closeup photos of random areas so they can zoom in on all photos to look for issues with a professional eye. “Also include places like the attic and aspects like roofing and insulation. If possible, the seller must also make a video which includes turning on taps, sprinklers, gas items, the fireplace, etc. to show that they actually work.” It’s important that all special features be included as this will directly affect the selling price, Geffen advises. “For
Voetstoots clause
instance, the agent may not be able to see from the photos that the floor tiles are, in fact, high-end imported Italian tiles or that the alarm system is expensive and state of the art.” From a legal perspective, Dewar recommends that the voetstoots clause must be included unless it’s an investment property where the clause doesn’t apply, in which case there must be more and better detailed photos and information for the agent to work with. “As soon as a buyer signs a voetstoots contract, it applies, so if this makes them nervous, they can put in an offer ‘subject to viewing within a week from lockdown’ or a similar suspensive clause.” He cautions that agents and clients should rather continue to look for ways to comply than to get around the regulations as it’s currently still illegal to visit sellers’ homes and getting arrested is a legal hurdle no-one wants to face.