December in Devonport Property Market: Gone Fishing

Posted by on Feb 03, 2011 | Leave a Comment

After a very poor year in 2010 we have recently seen more recent activity in the market and sales in excess of $1M are again more prevalent. It is a matter of buyers and sellers getting the right balance in terms of value rather than hanging on to that one high sale setting the benchmark and conversely for buyers trying to get the sale of the century. There is not the same pressure applied as when the market is booming and more time is able to be taken in doing due diligence which helps ensure a fair price.

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When utilizing the Government Valuation or more correctly the RV (Rating Valuation) for sales analysis it provides a very useful tool in ascertaining a general overview of the market. Done every three years it provides a sound base to capture the relative to market movement over this period and can also be an indicator to changes in movement in different property types.

However care has to be taken in not literally utilizing this data for individual properties. For Devonport the data provided shows the RV’s within 1% of the sales for December 2010. We note however that individually some of these sales were in excess of 20% below/above the RV. This equates to a difference in value of over $200,000 in some of these cases. My advice is; do not rely upon the Rating Valuation as a basis for the biggest financial decision you are likely to make. The same applies to E-Valuer which as I understand it merely utilizes the RV and adjusts it according to recent sales; therefore is only as good as the base data it is arrived from.

In Devonport because of the age of the housing stock you will generally find run down properties may be over valued (the RV) whilst renovated ones can be undervalued particularly if no Building permit was issued for work done. Properties which are not villas or bungalows also tend to be overvalued as get caught up in the general multiples of the mass appraisal computer generated data.

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