One of the hardest things to work out when you are buying is just how much to pay.
Lots of people use the properties rateable value (RV), sometimes referred to as Government value (GV) or capital value (CV) as a guide.
Well there are a few fundamental problems with rateable values,
- They are only reviewed every 3 years and through a process called mass valuation where each property simply gets entered into an algorithm and out pops your new RV (that’s the simplified version), so not terribly scientific.
- Most properties are rarely even visited by a valuer unless the owner objects to the new RV.
- And the obvious one, for two years and 10 months of the 3 year period it is out of date.
So what should you do as a buyer? The very best way to work out what to pay is to compare the property with other similar properties sold recently, these will often give you a really good gauge of what the property might be worth. As agents, we have relied on a website called Property Guru to supply us with this information for years, and it is part of the process we are required to undertake when we list the property for sale.
With the advancement of technology, this information is now thankfully available for buyers to obtain via websites like homes.co.nz where you can go in and search for a specific property and they will show you an estimated purchase price based on an up to date sales data comparison.
A small disclaimer is that this website is still a work in progress, but from the research I have done I would say they offer a really valuable service.
The other option is simply to obtain what is called an independent valuation from an independent registered valuer.
At the end of the day having a good look at the property and deciding what it is worth to you is often a gut feeling decision but I hope this little tool might be able to help you out when you are ready to make your next buying decision.
If you have any questions about the buying process you are always most welcome to contact me.