The Cost of House Valuation
If you’re selling your home, one of the costs you may expect to incur is that of a house valuation. After all, having a clear idea of exactly how much your house is worth can help you make smarter decisions as a whole that will help you find the right buyer for a house. There are several things you need to know about house valuations, though, and the associated costs.
You Don’t Have to Pay for a House Valuation
If you’re planning to sell your home, you don’t have to pay someone else to valuate it for you. Instead, it’s a process that you can handle on your own. There are many ways to get free house valuations without having to contact a professional.
- Consider using online calculators: One way you can figure out how much your home might be worth is to look to the Internet for house valuation online calculators. With just a bit of information, you can easily learn what your home might be worth. House valuation calculator options abound at various sites online these days.
- Think about an estate agent: Estate agents make it their job to connect people with information about just how much they could sell their homes for, and just by talking to a couple of different estate agents, you could easily learn the potential value of your home.
- Use a Cash Buyer: Many cash buyers or home investors are also willing to tell you what the cash value of your home is with no obligation. It’s important to note that when using a cash buyer, you’re likely to get about 80% of the value of your home, but this is a fast way to get a good look at just what your home might sell for quickly to an investor who has the money to buy it.
If You Want a Solid Number, use a Professional, But Expect to Pay for It
While you don’t have to pay for a valuation if you’re looking for the most correct possible number because you’re selling your home or you just need to get some idea of what its actual value might be right now for other purposes, it’s best to use a professional valuator. Using a professional valuator has several benefits.
- Professionals use industry best practices: While estate agents use their current knowledge of the market around them to help give you what your home might sell for, a professional valuator will use the industry’s standard practices to help you uncover what your home is truly worth.
- Many demand a professional valuation: Many banks and buildings and contents insurers will only take the numbers gained from professional house valuations to help determine the actual value of your home, so working with a professional can be required in certain situations.
- Professional valuators are willing to explain: You likely have lots of questions about the valuation of your home, and professional valuators are often ready to explain what devalues your property and what can help increase that value in a way estate agents simply can’t.
Knowing a bit more about what’s involved in the process and what it might cost you can help you decide exactly how you want to have your house valuated.
Commonly Asked Questions
Still, have questions about house price valuation and what it’s going to cost you? You’re not alone. Here are some of the most commonly asked questions when it comes to the cost of house valuation and the process itself.
Are There Different Types of Valuation?
There are essentially three main kinds of house valuations: free valuation, those performed by an estate agent, and those performed by a licensed valuator. A free valuation is generally an online valuation of a house. The way this works is simple. You go to a site like Rightmove or Zoopla, offer up some information about your house like how many bedrooms and bathrooms it has and where it’s located, and they come back with instant house valuations. They’re using data gathered from the market and the Land Registry to put together a close sense of what your house might be worth at any given time. House valuation prices fluctuate widely among these sites, so it’s not always easy to tell if a house online valuation is actually the real number behind your property or if it’s just an approximation.
Another type of quick house valuation comes from an estate agent. Because estate agents work in the world of real estate regularly, they have quite a bit to offer when it comes to house valuation prices. Every single day, they’re moving properties on and off the market, so they have a good general sense not only of what a property might go for but also of how to increase a house valuation price. The only drawback to using this method of valuation is that you’re not getting a clear sense of what your property is worth. Instead, you’re getting a valuation that tells you what it might sell for on the market today. What’s more, though, is that with this type of valuation of a house, you may find some price inflating, as estate agents work on commission. The higher the total value of the sale, the more money they end up making, so should you decide to have an estate agent valuate your house, you’ll want to make certain that you talk to a few different agents so you can get a much clearer sense of what you can list your house for.
The final type of valuation you might encounter is that from a licensed valuator, usually someone who is a member of RICS, or the Royal Institution of Chartered Surveyors. This is the valuation a bank might want to see in the event you’re applying for a mortgage or building and contents insurance. The reason behind that is this is a third-party survey that tells the true value of the home, not the value based on current market conditions the way an estate agent might value a home. The price of a valuation like this is not small, as it can run between £150 and £800. Usually, too, it takes a bit of time, often up to a week, to get the report back. Once you do, though, the information inside doesn’t last forever. Instead, it is valid for just three months.
How Is an Online House Valuation Different?
The difference between online house valuations and other types of house valuations is that an online valuation is based only on the information you enter into the computer. It’s almost more of an estimate than it is a valuation. Most online calculators are built to take several data points into account. The previous sold prices of homes in your area are a big factor, but so are the crime rates in the area where your house is located. Similarly, the age of the property in which you live is an important factor. Also, the latest data on the homes in your area as well as the home’s total square footage all become part of the information that is collected. The important thing to note, though, is that none of this helps you understand what your property is now that you have a brand-new refurbished kitchen or that you’ve done quite a bit of recent work on your front garden to help with your curb appeal. With an online valuation, it’s all about the condition and the saleability of your house, and that’s going to be the same for you as it is for your neighbour who lives two doors down and didn’t recently refurbish their kitchen or work to improve their front garden. One other important thing to note about online valuations like these is that they’re based on sold price data and trends from public records. If your home hasn’t sold in decades, the data is far more likely to be off.
Should You Have an Online House Valuation for UK Buyers or a More Traditional One?
If you are just looking to sell your home, an online house valuation or one performed by your estate agent is information enough to help you begin listing your house. The potential buyer will have to bring in a traditional valuator to help establish the actual value of the property when they apply for a mortgage anyway, so unless there’s a particular reason why you think you need to pay for a valuation, you probably don’t. Anything you get online or from an estate agent in terms of valuation, house buyers will pay attention to, so shelling out the extra cash when you don’t need to probably isn’t worth it at this point.
What is an Instant House Valuation?
An instant valuation of a house is pretty much the same thing as a free online valuation. House owners can get an instant valuation from lots of different websites, and all of those are based on the data around home sales. Different sites offer differing levels of valuation, though, and while no one site is better than any other, there are several out there that are pretty good. For example, Halifax’s House Price Index is one of the easiest tools to use, and it’s incredibly simple to help you base your home value on. There are no details to enter. You simply read the report on the condition of the housing market in the UK, and it allows you to look at how prices are changing across the various parts of the UK. It even allows you to compare how prices have changed for various house types. The data comes out every month, and often inside that data, you’ll see predictions for how home prices might change in the coming weeks and months. It’s a great tool, and it’s completely free. The other great option available today is nethouseprices.com. This is a much deeper look at the value of your specific home, but you will have to enter some data to get there. Typically, you’ll find out how many houses in the area of your type are selling for, but it also gives you access to information about what the rentals in your area go for so that you can list that on the information about your home as well. Additionally, you can dig a bit deeper and look at the most recent previous listings in your area how prices have changed over time and how much they eventually sold for when completion day happened. It’s great marketing information for your home.
What’s the Difference Between a Valuation and a Survey?
While some people use the valuation and survey of the term interchangeably, the reality is that they’re two very different processes. A valuation looks just at the value of the property alone and ensures that it’s worth the same amount as a potential purchaser might pay for it. It is either carried out at the start of the home sales process so you know how to price your home or during the sales process by a lending company so they know that the home is worth the price being paid. It doesn’t look at the condition of the property itself or highlight potential faults.
A survey, on the other hand, offers an in-depth report on the condition of the property. Surveyors work to inspect ceilings and walls, as well as the floors, the roof, and even the windows. They go as far as inspecting the heating systems, the electricity lines, and even the gas lines. What’s more, though, is that they do a comprehensive search for common potential problems like dampness, subsidence, rot, or even asbestos to better look at the overall condition of the home. It highlights any defects or hidden problems that could become problematic to its value down the road. A survey can also determine just how extensive repair work needs to be and what it’s going to cost. All of that helps to better establish the overall value of the home. It takes far longer to complete this than it might a valuation, but the last thing you want to do as a potential buyer is skip the survey, as it can highlight things that could damage the value of a home. While potential sellers often shy away from surveys, they can be a helpful tool before you sell, too, as you can establish the fact that you’ve recently had a survey, and it didn’t uncover any serious problems. Most mortgage companies will require a survey before they lend on a property as it helps to ensure their investment into a given house is a wise one.
Do Estate Agents do a Free Valuation on a House?
Most estate agents do perform valuations on a property, and their valuations tend to be at least a little more accurate than the kind you can get online. Initially, they begin their valuation before they ever talk to you. They research the neighbourhood and the surrounding properties. They will usually take a look at what has sold in your area and how much it has sold for. Then they dig into information about the schools that surround your property and any amenities that are close to your location like bus stops, transport links, and even local shops. Anything that might excite buyers adds to the value of your overall home. After that, they begin to look at your home. They will look at the outside of your home to establish some sense of what kerb appeal might look like for potential buyers, but they’ll also look inside your home. Expect an estate agent to walk through your home and take lots of measurements. They may also ask an extensive number of questions about the home itself. They’re looking for information about the home that might prove important to buyers. For example, if the home retains its original fireplace or you’ve recently installed an en-suite, you may find added value to your home from a buyer’s perspective. Additionally, an estate agent will chat with you a bit more to learn about your goals for selling the house. It doesn’t affect the overall value, but it can help them to better market your home. For example, if you’re leaving your home because you’ve just gotten a great job overseas, they know that you’re on a deadline to get moved, so they’ll want to make a quick sale a fairly high priority.
Once your agent has all of the information they need, they combine the data they found with the condition of your property, and they give you an overall sense of what your property might be worth. If your agent’s valuation doesn’t quite match your research, feel free to talk to another agent or simply ask them about their own valuation.
The next step is for your estate agent to take a hard look at what you can do before you sell your home to help boost its value. They can usually help you spot those fast, simple fixes that might help buyers see your home in a very different light. Something as simple as a coat of paint could considerably boost your home’s value when it hits the market.
Once the two of you agree on the price of the home, you can list it for buyers and take the next step in your home sales journey.
Can You Do Your Own House Valuation Free of Charge?
It is possible to do your own house valuation. It starts by doing a comparative market analysis, or CMA. While this term sounds a little scary for many potential home sellers, it’s actually an easy, straightforward process that almost anyone can do. This is a comparison of similar or recently sold properties that can help you to establish the value of your own home. To create your own CMA, you just have to log into a property portal like Rightmove, then work your way through the previous listings on properties both in your area, and also those that have a similar style, size, and amenities as yours to offer. Simply jot down the recent sales data for each of those properties, and you should be able to sense a pattern that can help you establish the value of your own home. Using data from your area, which is also available at no cost through the Land Registry, in conjunction with the data you find online can help you further establish the potential selling price of your home.
Who Should Handle My House Valuation if I Want to Sell?
Ultimately, it’s likely that you’ll want to use a combination of methods to help you figure out the value of your home. While free online valuations can be incredibly helpful, they may not give you the whole picture of what your property is worth. Similarly, estate agent values aren’t always the best way to go either, as you may find an inflated value to help an agent get a higher commission. While both of these methods are free, and thus more attractive to sellers than the cost of a professional valuation, the simple reality is that you’re going to have to do some digging if you want a low-cost, yet reliable valuation of your home. Often simply combining methods and the information you gather is a great way to learn more about the price of your home so you can list it. If you have a home that is problematic in terms of sales or valuation, your best bet is to simply pay for the professional valuation so you can get a true sense of its worth before you begin to advertise it to buyers. After all, that’s the only way you’re going to get an actual look at the value of your property and the potential sales price for which you can list it.