The real estate valuation is the evaluation of the price, either of a bare or building plot or of a house that is for sale. Estimating the value of the goods makes it possible to find a price balance that satisfies both the seller and the buyer at the same time. It is an essential step in the process of selling a property.
For the owner, it is always difficult to value his property. As a result of the sentimental values imposed at home, he may overestimate it. On the other hand, if the price estimated by the owner is not adequate to the trends in the real estate market, it is difficult to find a buyer. But also, if you underestimate the value of the house, you may lose money. In addition, the buyer may suspect the presence of defects or hidden defects in the house.
It is therefore important to have helped to sell your property at a fair price. It should be noted that the sale will also depend on the local real estate market and the current supply and demand. This is why you should use a real estate agency or ask for the opinion of a notary. They are experts in property valuation; they have the skills and above all the tools to carry out the valuation.
The purpose of the estimate will be to satisfy not only the owner, but also the buyer.
The reasons for estimating the value of a property
The sale of a house is the best known case for using an estimate of the value of a real estate property. However, there are many reasons for making the estimate.
Succession also requires an estimate of the property. It will be necessary to estimate the real estate assets to complete the tax procedures related to an estate. It may help the heirs to allocate responsibilities for the property.
In the event of divorce, both spouses are required to separate the real estate assets acquired jointly during the marriage. The sharing of real estate often remains a source of conflict in the case of divorce. Therefore, it is essential to make an estimate of the value of the house so that in the end the separated couple can make a decision on the fate of the house.
In some cases, the bank requests a mortgage when applying for a loan. This guarantee is based on real estate. Thus, to mortgage a property, it is first of all necessary to know the price. That is why its value must be estimated. On this basis, the loan will depend on this price. In the event that the loan is not repaid, the mortgage will be seized by the creditor.
The criteria to be taken into account
For a good valuation of a property, there are essential criteria that should not be ignored.
The geographical location of the house is of most interest to buyers. From one city to another, there is no price equivalence. This does not directly concern real estate but plays an important role such as the presence of transport infrastructures (bus, tramway, train…), public services such as schools, and the town hall.
The influence of the environment plays an important role in the valuation of a property because differences can occur between neighborhoods or from one street to another.
The economic situation of the city or town is also an important criterion.
In addition to the environment, the characteristics of the property are criteria to be taken into account. The orientation of the house is the most important because it determines the brightness of the interior. The existence of a courtyard or small garden will also increase the value of the house because it is rare to find these features in the city.
You have to consider the condition of the house. For a good estimate of its value, you should consider making repairs in case your property needs them.
When these criteria are acquired, methods are used to facilitate the valuation of the property.
The most common method is the direct comparison method. It consists in obtaining information on price references relating to recent sales.
Currently, buyers take into account energy performance. It is therefore important to consider it when estimating the property. It provides information on the energy performance of a dwelling, by evaluating its energy consumption.
The energy performance diagnosis (EPD) must include the annual energy consumption expressed in Kwh, the positioning in primary energy consumption per square meter per year and the recommendations for energy improvements.