Important tips when valuing a property

19th January 2024 · 5 min. read

We know how important it is for our clients to know precisely the real value of their property. Our team can carry out an a priori valuation, based on their in-depth knowledge of the sector and their extensive experience in sales. And, if necessary, we can also recommend an officially approved appraisal company, if this is what is required.

In fact, deciding the price of a property is a free exercise. The price can be whatever the owner wishes. But this is not realistic and does not guarantee the purchase and sale. To place a property for sale, and to acquire it in a reasonable time, it is necessary to consider three main areas. First, follow the official laws of each territory; second, be familiar with the laws of the real estate market (which fluctuate arbitrarily at times); and, finally, bear in mind that villas and apartaments are governed by special circumstances and characteristics, especially considering the type of select clientele at whom they are targeted.

Therefore, establishing which parameters make the price of a high-end property appropriate is complex. That is why it is good to get expert advice.

Initially, in order to not feel disoriented and to know how much your  home could be worth approximately, it is good to look around. If your property is similar to nearby properties, and one has recently been sold at a specific price, it is already a good reference when it putting up the “FOR SALE” sign.

But you have to be careful, because the characteristics of each property generate many price variations. Elements such as recent renovations,  construction year, advantageous orientation, type of neighbourhood, whether it is furnished or unfurnished, the potential for improvement of the property, and other elements, count when making the valuation and other elements.

But if you want to know, in detail, the price of your property, then you should hire an official valuation company.

The main reason for an official valuation of a property is for mortgage purposes. It is an essential requirement in Spain when applying for a mortgage loan from the bank. This was established by Law 5/2019 of 15 March, which regulates real estate credit contracts. This official appraisal value is used by the bank to evaluate the amount of the possible mortgage loan to be granted.

Other reasons for official valuations arise from different life situations. For example, the dissolution of a marriage, the execution of an inheritance, the request for an estate report by the state or a judge, or various business transactions.

If it is a high-end villa or apartment, the appraisal can be carried out perfectly by Christie’s International Real Estate – Madrid, Malaga & Marbella. Thanks to our extensive portfolio of properties and in-depth knowledge of the exclusive real estate sector in this area, we can value your home correctly; without being affected by property bubbles, impartially, and adding to the valuation an appropriate marketing strategy for your property.

On the other hand, in the case of official valuations, expert valuers oversee the evaluation. They are usually trained architects, engineers or economists who work independently or for a specialised company. They usually have a computer programme that has already established the elements to be appraised.

If an official valuation is necessary, the expert will visit the property to perform an on-site technical inspection. Among the data to be taken, he/she will even take measurements to be sure the square meters that appear on the plans of the property are correct. He/she will also take photographs and check the state of all the elements of the house (quality and optimal functioning). An exhaustive inventory of valuable decorative elements will also be made on an optional basis.

He/she will then review the property documentation and request any missing documentation. For example, the nota simple and other documents associated with the property. When the expert completes the valuation report, he/she can sign it electronically and send it to both the client and the bank (if necessary). It can take between a week and a month to process this report. In addition, this valuation is normally valid for a period of between six months and a year.

It is essential that the official appraisal be carried out by a person or company approved by the Bank of Spain. He/she will even have a registration number assigned to him/her as a valuer.

Finally, it is important to remember once again that sale prices must be realistic with respect to the market. For an owner the property may have a lot of value (especially emotional) but price is another concept more closely related to the economy and the law of supply anddemand. Let us not forget that the ultimate purpose is to achieve the sale and make the maximum profit. It is good to set aside other sentimental aspects or erroneous prejudices. That is why it is highly advisable to have a reliable real estate agency in the sales process. They will even reconsider, after a reasonable period, if the original price needs to be readjusted to achieve a sale.

As always, Christie’s International Real Estate – Madrid, Malaga & Marbella is here to help you sell your property with the utmost honesty and professionalism. Please do not hesitate to contact us.