Hi all,
I have recently come across a property that meets all my requirements and I am extremely keen to buy. I have done a fair amount of research and though it was very well priced.I got a property report done off RPData and it had it a little higher than the price it is being sold for. I have also had Residex done on my other properties before and it was fairly accurate.
These programs obviously controlled by relevant data…… a magical computer program does not walk through each property. So they aren't always going to be down to the exact dollar
These products cost a reasonable amount and it would have to be farily accurate otherwise they still wouldn't be in bussiness….
Apologies in advance if this is a stupid question but overall how accurate are they and for Data Vals by banks is this what they soley use? I am pretty sure ANZ soley use Residex.
And are reports that are available to consumers the same as what the banks have access to?
Fredo
Hate to say ANZ dont use Residex but Australian Property Monitors assuming they dont undertake some form of kerbside or full valuation.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Thanks Richard. Im assuming they are another company similar to RPData Residex or do they come up with a val using kerbside plus datat from the above mentioned?
Secondly do RPData and Residex most of the time come up with relatively the same figure?
An automated valuation service like that provided by various suppliers (and available for purchase by punters) is not a valuation and would not even be loosely called an appraisal as it is based on a series of algorithms based on certain criteria it does not rely on valuation principles of direct comparison or summation or capitalisation of net income etc.
Scenario 1: You see a 10 bedroom unit – how much should you pay? The 'computer' plays with a number of sales of 'comparable properties' ie 10 bedroom units in the suburb hmmmm…… there are very few 10 bedroom units ever sold – flawed result.
Scenario 2: Let's try 3 bed units……hmmm 50 of those sales, much more accurate. But it will not necessarily filter 'out of line sales' eg divorce settlements, estate sales, related party transactions etc from the analysis. It won't take into consideration location within the block of units, facing/main road location, issues within the building (like structural defects, disparate body corporates etc). The degree of accuracy is much higher due to the amount of data available but falls short of a real life valuation. Probably good enough for you to work out how much you might pay within +/-10%
The banks use a short form valuation which may either be a desktop analysis (review of comparable sales only) or a drive-by (review of comparable sales & external inspection – proves that there is an asset at the address).
fredo_4305 wrote:I got a property report done off RPData and it had it a little higher than the price it is being sold for. I have also had Residex done on my other properties before and it was fairly accurate.While I can't say much about the accuracy of these price estimates, it is possible that the difference in price between that in the report and the advertised price indicates the current state of the market. In a cooling market, it is more likely for the advertised price (and even the final sale price) to fall within the range stated in the report. In a heated market, the advertised and final sale price could exceed the report's price guide. Hence, the property may appear well-priced based on information you're getting in these reports, but don't forget to consider the condition of the market also.
For example, I know of a house that Residex estimated would be worth $405K. The advertised price was $380-420K. It received an unconditional offer at $436K, another at $450K and the highest offer was $489K. The house ended up selling for $450K because the highest offer failed to obtain finance. Even so, the final sale price was almost 10% greater than Residex's price. This was under the rather frenzied market conditions in 2009.
Compare this to another house that I looked at in December 2010 in a cooling market (and arguably during the pre-Christmas weekend, which is even quieter): Residex estimated the price at $507-557K. It sold at auction at $537K. I don't believe the price guides are a substitute for true valuation by a qualified person, but they are a quick and easy way to get more information about your intended purchase and the records of past sales are also worth studying.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
