Within the different negotiations that a person or a company carries out, real estate transactions can be the most significant. The purchase or sale of property attends medium and long-term plans. Therefore the decision taken will significantly impact the future of those involved. Also, these are substantial investments, which have a series of conditions and requirements to undertake the project.
Appraisals are a fundamental instrument when making decisions regarding this matter. It is a technical assessment prepared by certified experts, whose objective is to determine the price of a property. There are different types of valuations, and each one attends to specific needs. It is essential to know each one of them, to determine the one that suits your needs.
Real Estate Appraisals
This type of study aims to know the precise value of a property, for the purchase, sale, lease, mortgage or rent statement. Mainly it takes into consideration the characteristics of the property and its land. Also, the technical evaluator considers factors such as location, municipal regulations, costs of public services and the facilities that the environment offers near the site.
Physical or Direct Appraisals
This valuation takes in mind the costs of materials and labor concerning the property. The question to answer is how much it would cost to rebuild the property at today's factor costs. This study is also known as asset replacement value.
Many times this is used, to decide if it is more convenient to make repairs, or it is better to start over. Applies especially in those locations that time and use have deteriorated. If you in BC you need Appraisal services of this kind, you must be aware of the company to choose, since these studies need specialized engineering and architecture knowledge.
Valuation by Income Capitalization
It consists of applying a percentage of the utility of the commercial value of the property. Among other things, the wealth is equated with real bank interest rates. These are the factors that are taken into account to determine the final value:
- Kind of property
- State of conservation
- Easy to rent in the surroundings
- Capital gain
- Property damage
Most of the time the number does not coincide with the physical valuation method, because in this case the capital is sought to invest in the property to obtain the income.
This is a complete study since it combines the direct valuation, the capitalization of rents and also includes the market value. In cases of purchase or sale negotiations, this is usually the number to be taken in mind. No matter how much the property is physically worth, it cannot be sold (or should not be bought) at prices far from what the market determines, either by excess or by default.
Ecomappraisals is the best option for your appraisals
If you are in BC looking for appraisal services, you have arrived at the best place. We have more than 30 years of experience, providing appraisal services for residential mortgages, matrimonial settlements, foreclosures, estates, and more. We offer quick and accurate answers, maintaining a constant flow of communication with you. In this way, we ensure that you obtain a service that fully meets your needs. Quote us or make your request online, our tea ready to assist you.Bc Appraisal Services