Having Your Residential Investment Property Valued

Whether you own one residential property investment or a string of properties it is always a good idea to have their value reviewed on a regular basis.  You might have a rough idea of your portfolio’s value at any given time, but it’s important to get a professional’s opinion, especially if you’re looking to either use equity in some of your existing assets to fund new investments or if you simply just want to realise the profit on the properties.


Property valuations are generally carried out under the following circumstances:

  • If you’re looking to sell a property, a real estate agency will usually provide an appraisal of the value of the property.
  • If you’re looking to purchase a property, your bank or lending institution will conduct its own valuation.  A licensed property valuer will generally carry out the assessment and report back.
  • In terms of property investment, if you’re looking to fund further residential property investments from the equity in your existing portfolio you can also hire a professional valuer to provide an estimate.  Many property managers provide this service.


To provide an accurate and thorough valuation, a professional licensed valuer will normally visit the property or properties in question, and conduct a review of the condition of the buildings, noting any structural issues as well as the main layout of the property (including things like the number of rooms, fixtures and fittings, garage access and out buildings).  The valuer will also look at whether the building has any recent improvements or renovations, and they may take photos for future reference, and these can be useful for keeping track of a building’s condition over a period of time.


To come up with a final valuation, most valuers will use either what is referred to as the “direct comparison” method – or looking at the most recent sales of similar properties in the area – or the “summation” method, in which they will look at factors such as land value and added value or improvements to the building as a whole.  Other factors that will also be taken into consideration include the property’s location, any council restrictions and zoning regulations.  They will then provide an estimate on the market value of your residential property investment.


To work out the existing equity you have in your property or properties you would then need to subtract the debt remaining on your mortgage.  Don’t forget that if you are applying through a bank or mortgage lender to access your existing equity their valuers may not come back with a figure that matches your expectations.  Depending on the results you may have to rethink your current position of your investment strategy or adjust your financial goals accordingly.


If you do have residential property investments this is why it is always a good idea to have valuations conducted on a regular basis.  Property investment experts such as Ironfish can help if you want more information or would like to talk to someone about having a valuation conducted on your properties.

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