A bank valuation of property is a key part of the home loan process when you’re refinancing or seeking finance to purchase a home or investment property. Bank valuations are performed by independent property valuers and will provide a bank property valuation estimate. We offer free bank valuation of property outside of the loan process as knowing your property value can help you make the most informed decisions when it comes to the property and home loan process.
A bank property valuation will take into consideration a number of features about a property. Some of these include:
- Property type and it’s size
- Property zoning, planning and restrictions
- Quality and condition of the building structure and it’s fittings
- Comparisons to other similar properties that have recently sold
- Areas for improvement
A bank valuation can be an important step to improving your situation. Some of the benefits that can follow a valuation of property include:
- Accessing equity for a new investment property
- Negotiating a better deal with your current bank
- Negotiating an even better deal through refinancing
- Debt consolidation of a number of debts to reduce rates and fees to make your debts easier to manage
A bank valuation is typically completed by an independent property valuer to provide an estimate of property value. A building inspection will be carried out by a building inspector who will assess the structural integrity of a building and provide a report detailing any building defects.
Your bank valuation plays an important role in determining your loan to value ratio (LVR) as your LVR is calculated by dividing your loan value by the bank valuation and multiplied by 100 to get a percentage.
LVR = (Loan Value / Bank Valuation) x 100
For example: if you loan value is $400,000 and your bank valuation is $500,000 your LVR is 80%
($400,000 / $500,000) x 100 = 80%
Knowing your LVR is important as banks typically offer lower rates for loans with lower LVRs and Lender’s Mortgage Insurance (LMI) is charged on home loans with LVRs higher than 80% which can add thousands of dollars to your loan balance.
Yes, it is possible to contest a bank valuation if you can demonstrate there are comparable sales data in the property’s area that the bank valuation has noy taken into consideration. Properties that are on the market advertised at higher prices and real estate agent appraisals are not considered comparable sales data and won’t be accepted if you are contesting your bank valuation.
A bank valuation is the property value estimate performed by an independent valuer taking into account comparable properties recent sales data. The market value of a property is the highest price a buyer is prepared to pay and a seller is prepared to accept. Sometimes the market value is affected by emotion and other factors which can mean bank valuations and market values can sometimes differ.
Our bank valuations are complimentary so there is no cost to you to understand your property value. Some other bank property valuations can cost between $300 to $600 and if a commercial valuation is required over a property these can be $1500 or more per property.
To get the best bank property valuation make sure your property is clean and in good condition. Address any minor repairs, declutter, and present your property in the best possible light. Having documentation on any recent renovations or unique features can also sometimes be helpful for the bank property valuation.