Online Property Valuation vs Independent Property Valuation - What's the Difference?

There are various types of property valuations that all play an essential part in real estate transactions.?

But, what’s the difference between an online valuation and an independent valuation?

An online valuation can be a helpful tool for the speed at which it's generated. But the question remains: how accurate is it?

And how does it compare to an independent valuation prepared by a certified Property Valuer?

So, here's what you need to know about the difference between these two valuations.

What Are Online Property Valuations?

As the name suggests, an online property valuation is a valuation of your property that you can do?

online and from the comfort of your home.

They are more commonly referred to as online appraisals because they estimate the sale price of your property.?

Most of the websites that offer an online property report offer it as a free and instant property value estimate. You simply input the property address, and the algorithm will compare recent sales statistics of similar properties using property data, recent comparable sales and property listings.

The benefit of an online valuation is that it’s relatively cheap and often a lot quicker than having property valuers come out to the property.?

So, an online appraisal is a pretty useful tool in the early stages of the process to get an idea of how much you can expect to get from the sale of your property.?

It’s also a quick and efficient way for buyers to get a rough idea of what an acceptable offer is during the negotiating stages of the real estate transaction.?

However, this type of appraisal has its limitations and may not be accurate or reflective of your particular situation.

What Are the Limitations of an Online Property Value Estimate??

There are a few factors you need to consider when solely relying on an online valuation report:?

• Informal report:?an online appraisal is an informal valuation, meaning it’s?not?legally enforceable.?
• Not detailed:?the online valuation report won’t take into account any of the property’s physical features, such as any structural issues or if the plumbing and electrics need replacing.?
• Possibility of an underestimation:?your property might also have unique features that can either increase the value that an online appraisal won’t pick up on.

So, online property valuations can be pretty valuable when you’re deciding whether or not it’s currently worth it to sell your property.?

But, once you get the ball rolling, the real estate transaction process can get long and complex, so you’ll want to get an accurate valuation from certified independent property valuers.?

What Are Independent Property Valuations?

The purpose of an independent valuation is essentially the same as online valuations: to identify the approximate market value at that particular time.?

However, the difference lies in how the valuation is completed.?

Independent valuations are produced in report form?after?a valuer has completed a physical inspection of your property.?

The property valuation report will generally provide you with more than just an approximate value; it’ll also cover:?

• a detailed description of the property;?
• how the valuation was conducted;?
• property market evidence of similar properties; and?
• valuation calculations.?

What’s more, an independent valuation is a legally enforceable report and is based on various factors assessed by a qualified and licensed Property Valuer.?These factors include:?

• market conditions;?
• recent sales in the same area;
• the size and building structure of the property;?
• the local council zoning; and
• location and surrounding amenities.?

So, you’ll be able to use the valuation for a variety of purposes, including:?

• stamp duty purposes:?to help in instances where you’re transferring property between owners and ownership entities such as a trust;?
• tax purposes:?a market assessment valuation is used to calculate how much tax will be levied on your property;?
• capital gain tax purposes:?a capital gains tax valuation is required by the Australian Tax Office (ATO) to calculate the capital gain you may have made on the sale of your investment property.??

For more on the different types of valuations, make sure to check out our?ultimate guide.?

It’s worth noting that a fair and accurate independent property valuation comes at a price.?

Depending on the independent valuer’s rates, size, and value, you can expect most valuations to cost anything between $300 and $600.??

How Can You Get a Property Valuation?

Qualified valuers are the only professionals who can offer independent property valuations.?

At Duo Tax, our team of expert valuers have been certified as practising Property Valuers through the?Australian Property Institute?(API).

We provide a?comprehensive suite of valuation services?across Australia designed to deliver reliable and affordable valuation reports for your property.

Key Takeaways

What’s the difference between an online valuation and an independent one? It turns out there are a few.?

Online valuations simply provide property value estimates of how much your property might be worth based on comparable properties in the area. They may offer some ballpark figures, which is helpful if you're looking to get more educated about what the sale price might look like.?

Independent valuers, on the other hand, will conduct a physical inspection of your property before producing a detailed and legally enforceable report that can be used in a variety of circumstances, including:?

• real estate transactions;?
• stamp duty for transfers; and?
• capital gains tax on the sale of your property.?

So, it’s more than just a value estimate.?

If you’re a buyer or seller, you’ll want to get your hands on a valuation report to help get an accurate estimate of the property’s value on the real estate market.?

Thanks to our nationwide presence, our Duo Tax Property Valuers offer a full range of property valuation services across Australia so that we can deliver reliable and affordable valuation reports for your property.

Get in touch?with one of our friendly API certified valuers to discuss and organise your next property valuation today!

Disclaimer: Please note that every effort has been made to ensure that the information provided in this guide is accurate. You should note, however, that the information is intended as a guide only, providing an overview of general information available to property investors. This guide is not intended to be an exhaustive source of information and should not be seen to constitute legal or tax advice. You should, where necessary, seek a second professional opinion for any legal or tax issues raised in your investing affairs.