Valuation of property is actually the practice of estimating the actual worth of an asset. It can be commercial, residential, or acreage that will undergo the process in order to assess the recent value of the property. Based on the benefit that the land will provide and the accessibility to the main junctions and the neighbouring facilities are the factors that increases the value of the site. The act of selling and buying requires property valuation process as the buyer can ascertain if the net worth he pays is quite significant and also the seller fixes the profitable margin on the valuation basis. Thus, valuation property is the act of calculating the actual worth and value of a property. It is done by the certified and skilled people of the state after a license. Selling and buying gives rise to many questions, like the cost that has to be invested or the actual value in the market. When these questions arise, it's very necessary to understand the value of the property that is to be sold, bought, or leased and hence it's necessary to spend money and time on property valuers.
Valuation property is the foremost thing that the customer approaches for loan against the property and home loans. It is based on the income of the applicant and the net worth of the property and then the loan is sanctioned. The necessity of property valuation are:
- It is required to plan for sale of the property While buying a property you have to look to the present worth and you must forecast on the future merit of the asset before buying it. In order to meet the tax requirements.
- There are two principle catagories that can be classified according to International Property Valuation standards, such as:
- Market Value Approach: This is a standard approach which has a set of arrangements that's used by the professional property analysers who calculates the significant value of the possession. The market value of the property is actually the gross value of the same that increases or decreases with the growth of the surrounding areas. Therefore, the properties are fixed sale prices in and around the value that's calculated. Each commercial valuation property adopts different approach and methods to the calculations, even the resulting output values is more or less similar to the changes in the market environment.
- Others: There are also other factors that are directly proportional to the property valuation method other than the market value that's regulated. There are various supplementary factors, such as
- Surrogating costs : Reconstructing and restructuring costs of the property stands as the factor that influences the value of the property.
- Cost of generation : Contingent to the fact and figures that will cost to generate a duplicate of the same sort the is determined in the permutation to the other factors.
- Location : The most imporatant fact is the location of the property and the surroundings.