Residential property valuation is a prerequisite to the property selling and buying processes. Valuation gives buyers and sellers insights into the estimated value of a property as per the market pricing trends for comparable properties.
According to a Dubai Land Department report, the Dubai Real Estate market experienced an unprecedented surge in 2021, with more than 84,196 real estate transactions taking place that was valued at almost AED 300 billion.
This represents a remarkable growth of 66.3% in transaction volume and 72% in transaction value compared to the previous year. In terms of the YoY comparison, there was a 110.19% increase in value and a 74.77% increase in sales volume.
An independent residential property valuation helps you establish a real estate price negotiation baseline.
When you have a clear understanding of the estimated value of the real estate, you can make informed decisions regarding the selling or purchasing of a residential property.
Below, we’ll explain all you need to know about residential property valuation in Dubai, UAE, and why it’s crucial for investors.
Overview of Residential Property Valuation
A residential property valuation is a value assessment for a residential property to understand its current value based on the property’s size, its type, and the latest real estate market pricing trends for similar properties.
If you want to avoid making a bad deal, residential property valuation is necessary for buying and selling a property.
Property valuation creates transparency between the buyer and seller, which results in a deal that meets the expectations of all parties involved.
Understanding the Importance of Finding the Value of a Property
Assess the Pros & Cons of Investing in a Residential Property
A residential property valuation report contains valuable information such as the market value of the property, its structural feasibility, location, and long-term benefits.
This information is essential for property buyers looking to invest in the real estate market in Dubai
The assessment of pros and cons helps make an informed decision regarding real estate investment. The buyers can review the final valuation report to decide whether they want to go through with the investment or not.
Get Appropriate Insurance for the Property
Before applying for the appropriate insurance plan for your real estate, you must conduct a thorough residential property valuation. You can choose an insurance plan that works best for you based on the property’s value.
Without proper valuation, you may end up under-insuring or over-insuring the place. An accurate residential property valuation is essential if you want a cost-effective insurance plan that works best for you in every way.
Determine Accurate Property Value
Sellers who want to make the most out of their property investment need to have an accurate understanding of the current property value. Accurate determination of the property market value helps sellers secure maximum ROI.
For buyers, an independent residential property valuation plays a huge role in making informed investment decisions. When buyers have an accurate idea about the value of a property, it can make the negotiation process straightforward.
Understand Renovation Needs
Since property valuation involves extensive inspection of the place, it may reveal issues with the structural or mechanical components of the property. Sellers can work on those issues to maximize the value of the property.
Residential property valuation enables you to benefit from the expertise of experienced professionals. These experts offer suggestions you can implement to increase your property’s market value drastically.
Get a Health Report on the Property
A residential property valuation process is kind of like conducting a health checkup for the building structure. The report highlights the strengths and weaknesses of your property that you can work on to increase its value.
For example, the report may contain details such as fixtures that need work that might end up causing major expenses in the future. Property investors can work on the insights provided in the report to maintain the outlook of the residential property.
Important for Taxation Purposes
Property tax is a standard requirement for most regions in the world. It is calculated based on the value of the properties that you own. You’d need to calculate and pay the tax to the concerned authorities to avoid tax penalties.
With property valuations, you can ensure you don’t underpay or overpay the tax. So, residential property valuation is essential if you want to keep your taxation affairs in order.
First-time property buyers are more vulnerable to fraud and scams. If you don’t have experience conducting real estate deals, you will likely feel overwhelmed by the nuances.
With an independent residential property valuation, you can feel confident regarding your investment decisions.
Since you know the property’s value, you can use it as your guide during the negotiations.
And if a seller quotes a higher price than the one mentioned in the report, you can decide whether you want to go through with the deal.
See related: Types of residential property
Residential property valuation is an intrinsic part of the property buying and selling process. It helps both buyer and seller come to an understanding that works for all stakeholders.
Along with that, residential property valuation is also required by some government and private entities based on your loan and insurance needs.
Get in touch with Land Sterling for professional residential property valuation services in Dubai, UAE.