In everyday language, the phrases “to value” and “to appraise” something are often used interchangeably, and are applied whenever we need to work out how much something is worth. In the property industry however, there is a vast difference between an appraisal and an evaluation, which is why people often get confused as to which one they need when it comes to buying, selling or insuring their property.
We’d like to end that confusion right now by explaining the crucial differences between the two, so that you know which one will best suit your requirements.
Property Appraisals
The first important thing to understand about appraisals is that they are, at best, educated guesses as to the likely selling price of your property, based on the market and current trends. Appraisals are really just opinions. Professional opinions, yes, but opinions just the same. They are not legally binding, so do therefore not have to withstand the scrutiny of being accurate.
In most instances, if you ask five different estate agents to appraise the value of your property, you will get five different figures. This is largely because the answers will be based on what the agent thinks you want hear, and are often inflated to increase the chances of their being awarded the listing.
Agents don’t generally charge a fee for doing an appraisal, so you won’t be out of pocket if you’re just looking to get “a feel” for what your property might be worth.
Property Valuations
Property valuations, on the other hand, can only be carried out by a qualified expert, who has successfully completed the required tertiary areas of study. You will have to pay for a professional valuation, but it is a worthwhile investment as you will receive an unbiased, independent and accurate valuation that is legally valid. This is important if you’re using it to obtain building insurance, for example. Other reasons could include applying for finance from a bank, or establishing the value of a deceased estate.
At The Property Partnership East Rand, our team of qualified Chartered Surveyors and Valuers is waiting to assist you with the professional valuation of your commercial property, land, or business assets such as equipment and machinery. Contact us today.