By Guest Blogger, John Anderson,
Vals Melbourne
There are various types of property valuations to choose from, knowing the purpose of the valuation is key to getting the result you require. Where you get a property valuation from is just as important as figuring out the type of valuation you need.
By choosing an independent property valuation company, you are guaranteed to receive high quality professional service that is tailored to your property related needs, a comprehensive report that details all the findings and data analysis researched by a certified property valuer that has extensive knowledge and decades of experience in a specialised field of the property market.
As we mentioned there are various types of valuation services, in most situations you might require a valuation for current market purposes, which is taking recent comparable sales and market trends as well as the current state of the property to determine the fair market value as of the date of the valuation. However, its not uncommon for a client to request a valuation report for a passed date.
This article will give you an insight into a retrospective valuation otherwise known as a backdated valuation, why you need it and how its used.
What is a Retrospective Valuation?
A retrospective valuation, also known as a backdated or historical valuation, meaning that an accurate property vale can be distinguished at a previous date in time. (e.g 4th March 2007)
Most common requests for seeking out a retrospective valuation:
• Capital gains tax
• Family law & Separation
• Estate/ Probate purposes- where a current market value may not be relevant
• Litigation Purposes
• Government Grant Applications
• Stamp Duty
A retrospective valuation is a challenging task and having a certified independent valuer that has the extensive knowledge of the local market, that is impartial and unbiased of all analysis provided in your corner will give you the result you deserve.
Purpose of Retrospective Valuations
In most cases, a backdated valuation is most commonly used for capital gains tax (CGT) purposes, especially for an investment property owner that acquired a property after 20 September 1985. With a retrospective valuation, CGT liabilities are dependant not just on the property worth, but also the amount the property has increased in value over time.
An independent valuer will research sales of the local area from a particular point in time, to help identify the historical market value.
What is needed to calculate a retrospective value of a property?
With a retrospective valuation what first needs to be determine is the date in which you would like the valuation report to detail. This includes the month and year, (e.g., January 2001), being one of the most complex valuation processes to determine the figure, due to unique properties and any additional changes that may have occurred.
A retrospective valuation requires extreme diligence, extensive hard-work, and research through databases to access the historical market data of the property in question as well as the local area of sales from neighbouring properties at that time.
A brief description of the property at the specific time is required including details such as:
• Renovations that have occurred (kitchen/bathroom)
• Description of the property (number of rooms etc)
• The purchase year of the property
• Sale agreement (listing all information and the property price)
• Any additional amenities
For an accurate retrospective report to be achieved, valuers may also require an original valuation report if one was conducted. As various methodologies are used to determine the property’s value as well as all market data, if the original valuation was not to your liking and had errors or incorrect assumptions, the valuer can revisit the report and make any additional changes that were missed and perform an updated report for the retrospective valuation to reach an outcome that best suits your requirements.
Taking the changes to market conditions over time into account that may have impacted the sale price or historical valuation of the property is important for the valuation report to be accurate and meet all requirements requested. Any personal information or photos of the property are essential to help cross-check with other sources and databases to help finalise the report detailing accurately.
No matter the reasoning for your property related purpose having a certified independent valuer to conduct the valuation is vital in ensuring you receive a report that is to the highest of standards, true, accurate and unbiased, reflecting and exceeding your property requirements.
We know how significant a property valuation can be, depending on your purpose, whether it’s in terms of tax obligations. litigation purposes, or estate planning, our valuers have the highest of standards in valuation services offered, with decades of experience and API certified. We ensure you will receive a tailored service that you can trust.
Author bio
John Anderson - LinkedIn Profile
John Anderson is one of Melbourne’s leading experts in commercial and residential property valuation services. John is a registered Chartered Surveyor and Senior Property Valuer with over 20 years of professional experience providing property valuations across Melbourne and Victoria. His in-depth expertise in real estate and property has allowed him to share his specialised knowledge as an authority keynote speaker at conferences and universities across Melbourne.
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