Think big when selling
HOMES: ASKING PRICES FIXED ON INADEQUATE VALUATION CAN WRECK SALES
Delving into critical information that’s often missing from standard property valuations.
Determining the true market value of a home is about more than design, amenities, kerb appeal, location and size. While those are of course important elements of home valuations, they only paint half the picture for buyers and sellers looking to enter property transactions.
The sad truth is that many “professional assessors” tick too few boxes during a valuation and the immensely frustrating result of this one-dimensional process is sellers all too often pricing themselves out of the market.
Basic valuation checklist
Valuations should always begin with the standard criteria, including:
Location pricing: Not only the suburb in which your home is located, but where it’s located within the suburb.
Location amenities: Proximity to good schools, shopping malls and entertainment hubs.
Size: Of both the home and the property on which it sits. How many rooms does it have, how many bathrooms and how many entertainment spaces?
Age: Historic homes and features can add value, but modern homes generally have greater market appeal.
Property amenities: Does the property offer extra features like garages, extra space to park cars behind locked gates and fences, additional storage or pools?
Kerb appeal: Properties that are well maintained on the outside are more attractive to buyers.
Renovations: Homes with renovated kitchens and bathrooms command higher prices. If you’re going to spend money on any updates, that’s where to start.
Big picture checklist
In the SA property context, sellers must demand a wider valuation checklist to more accurately gauge market temperature.
It includes:
Uninterrupted power: Location price comparison goes out the window if a luxury home of similar size on your secure estate was sold with a green energy system, a generator that powers the house or a state-of-the-art uninterrupted power supply big enough to cope with any Eskom meltdown. Load shedding-adapted homes achieve higher sale prices.
Security features: Differing levels of home security also turn neighbourhood sale price comparisons into an “apples and oranges” exercise. According to Lightstone’s 2022 Estate Agents’ Sentiment Survey, security is the single most important criteria for buyers. If your property has better (and more attractive) security features than your neighbours, it’ll be worth more. The reverse is also true.
Crime rates: In urban areas, a low incidence of crime in your suburb can be leveraged as a selling point, as can numberplate reading cameras and other proactive crime prevention measures in your area.
Zoning/development potential: You love your home, but if there is rezoning potential try to lose the sentiment and consider the development value of your land. Zoning potential is a must in every valuation.
Interest rates: Both short-term interest rates (like what you pay on a credit card) and long-term interest rates (like what you pay on your bond) influence people’s ability to afford a home.
Valuations in times of higher interest rates must consider that the buyer pool will most likely be smaller, and sellers should be realistic about the market when determining a selling price.
Success for sellers – seeing the highest return on their investments in the shortest space of time – depends entirely on how they start the sale process.
Insist on a valuation that ticks all the boxes and make decisions with your head, not your heart.