Regardless of whether you want to buy or sell a apartment, the property evaluation process is a stage that we do not advise you to skip. Even more so when you are in the position of the buyer, you will want to know that your money is properly invested, right? Only in this way will you realize what is the right price, but also what is the right option of financing.
In the following we will tell you what the appraisal of an apartment entails, how much it costs, who takes care of it, but also when it is done and why it is so important .
What does the evaluation of an apartment entail?
Unfortunately, there is no calculator for evaluating the apartment, nor can you evaluate the apartment online. Therefore, you will need an accredited appraiser. He will have a choice between three different approaches to prepare the apartment evaluation report. We are talking about:
- The approach based on the market, that is, the one that takes into account information about recent offers and transactions. Basically, the appraiser will compare the prices of properties similar to the one you want to buy. If this information is not available or if the property is completely and utterly special, for example it has purified water at the kitchen tap, < span style="font-weight: 400;">concept unique introduced on the market of residential neighborhoods in Romania by Aqua City, then this approach does not will still be valid;
- The cost-based approach, i.e. the one by which the appraiser deducts the accumulated depreciation from the new construction cost and then adds the estimated value of the land;
- The income-based approach, possible through several methods, all taking into account either the realized or the provisioned income. More precisely, the appraiser will analyze the ability of the property to obtain income and uses direct capitalization or daily cash flow to estimate the value of the property.
In what situations can you request an evaluation report
The most common situations in which an apartment evaluation report will be requested are those in which the property is to be sold. Both the seller and the buyer have the right to request this operation.
Of course, as an owner you will be able to request this assessment to determine the taxable value, for cases of inheritance or to prove the financial possibilities for emigration. < /span>
Also take into account the fact that the value established for a property can be influenced by the purpose for which it is made. For example, if you request an evaluation for a loan from the bank, the apartment evaluation obtained for a mortgage loan cannot be used for any purpose other than the initial one. Speaking of credit, find out what the process of pre-approval and study the option rates to the developer.
Necessary steps to evaluate an apartment
Who is in charge of appraising the apartment? If you want such a report, you will have to contact a specialist and present the type of property you want evaluated, but also the purpose of the evaluation and the location of the property. Obviously, you will have to provide them with the rest of the information they will request.
Unfortunately, there is no free apartment evaluation! So who pays and how much does an apartment appraisal cost? The price of the evaluation of the apartment, as well as the execution term for the evaluation report will be established by mutual agreement with the expert and the payment will be executed by the applicant. The rate will not take into account the value of the apartment, but the amount of work required to create the report and other costs of acquiring the relevant market data.
To make the report, the property owner will have to present the following documents:
- Property deeds;
- Copy of the identity card;
- Tab stop;
- Cadastre;
- Extract from land deed for information;
- Location and boundary plan;
- Zone planning.
All these documents can be obtained from the real estate developer. The inspection of the property is to be carried out, taking into account the evaluation criteria of the apartment. The evaluator will need information about construction and finishes< /span>, the system of functional installations, building equipment and so on.
This will also check energy certificate of the building, the level of thermal insulation, the sanitary and electrical installations, the degree of brightness and the materials used for the arrangement, among others.
The evaluation of the apartment will be necessary to ensure that the value paid for the apartment is correct, but also to establish very clearly the quality of the property in which you are going to invest.