Buying or selling a property is a long, lengthy process – as it should be considering the investment people are making by getting onto the property ladder. Along the way, you’ll encounter different requirements and services that can make things easier, or that need to be completed.
A market appraisal is one of those services that can assist the seller when they’re first putting a property on the market. It will provide an estimate of what the property is worth, which is useful when setting an asking price.
What Is A Market Appraisal?
A market appraisal is a process that provides a property owner with an estimate of what it is worth, and recommendations to ensure you get the full value. When it is time to sell, this will ensure you know the best price to attract the right buyers and get the return on your investment from when you bought the property.
The more experienced the property appraiser, the more confidence you can have that the valuation they provide will be accurately reflected in the price of the sale. They will know what to look for and make sure you set realistic expectations.
Property Appraiser Vs Property Surveyor
Just like a market appraisal is different from a property survey, the people who carry them out are different, too.
A property appraiser looks at the property in question and the surrounding area, as well as other factors, to determine what the value should be. This will be done by someone experienced in the property market, so they provide the best advice and estimates.
On the other hand, a property surveyor should be qualified to prove their expertise. They will look closer at the individual property, spotting signs and issues that might not be obvious or clear to others. This can reveal details that can change the price of a property.
What Factors Does A Market Appraisal Take Into Account When Determining Property Prices?
There are a number of factors that must be considered during a market appraisal to provide an estimate to a property’s worth. While looking at prices of similar properties can be a useful benchmark, every building is different, as are its locations, features and intended uses.
Unlike a property surveyor, no qualification is needed to be a property appraiser, but there is training that can help. Experience is the most important thing, knowing what factors to look for when providing a value, and the actions owners need to complete to ensure the property is at its full potential.
The area a property is in has a big impact on its value, regardless of its use or type. There are different things to consider with residential and commercial property, but what’s around it matters, and a market appraisal will take this into account.
Industrial units or warehouses, for example, will require good access and road links, so if they are close to junctions and main roads, this can add to their value. Shops and restaurants will want high footfall areas, or to be away from the competition to attract local residents.
Any future developments in the area can also have an impact on the value, making it more or less appealing a prospect for potential buyers depending on what’s happening. This means you want a property appraiser who knows the area well and can find out what’s in the pipeline.
Property Type And Size
The kind of property going on the market makes a big difference to its value. Combined with the local area, and what businesses are in demand, a market appraisal can determine how valuable a property will be to potential buyers looking to operate in that area. Properties suited for retail and hospitality businesses in particular can benefit from this.
Unsurprisingly, size is also a big factor in determining value – with bigger property likely to attract a higher price. More space means more opportunity, allowing for a scalable business or ensuring that extra space for storage, for example, isn’t necessary.
Condition Of The Property
A property appraiser will also look at the property itself to identify characteristics and features to justify a higher price. This, in conjunction with other factors, can then be used to set an asking price.
The property evaluation will be superficial, without intrusive methods to check small details. This gives the seller a good estimate of what the property can sell for.
A commercial property valuation, carried out by a qualified surveyor, will go into a lot more detail, looking at the building’s structure and identifying its different characteristics. This can increase the value or decrease it, depending on what is found. It will also identify what needs to be done to address any issues, which the seller or buyer can resolve, depending on what is agreed.
How Does A Market Appraisal Differ From A Property Valuation?
A market appraisal and a commercial property valuation are used at different points of the process involving the sale of a property. They are often used by different parties, too, as each side involved in the transaction will be looking to get the best value they can.
There are costs involved in both options, but the information they provide can be invaluable – and sometimes be absorbed by other parts of the processes depending on what services are chosen and utilised.
When Should You Get A Market Appraisal?
A market appraisal is most useful when you’re selling a property. It can be hard to know what price to ask for from potential buyers. While there can be some back and forth while settling on a price, it’s important to know what is realistically achievable – and what you might need to do to get that amount.
This is where market appraisals are invaluable. They are carried out by an experienced property appraiser – someone who knows the property and local area well enough to provide you with what you need to set a reasonable asking price that delivers what you want.
When Do You Need A Commercial Property Valuation?
It is most common that a potential buyer will seek a commercial property valuation as the sale progresses. This is to make sure that the property is worth the asking, or agreed, price.
A valuation will be more in-depth than a market appraisal, looking under the surface – literally, in some cases – to make sure that any features and issues are documented. It can lead to a new negotiation on price to ensure the buyer is completely happy that they’re making a good investment.
Find Out More About A Market Appraisal From Williams Sillitoe
A market appraisal is a very useful tool to understand what kind of price to sell a property for. As it’s an estimate, an experienced property appraiser will be able to show you exactly what makes it justify the price you decide, both features with the building as well as the wider area, so you have a better understanding of what to expect.
Our experts at Williams Sillitoe have gained their expertise and experienced appraisal skills over many years, working with local properties to help sellers make the right decisions and get the best price. If you’d like to know more about a market appraisal and what else we can do, get in touch with us now.