How Do Online Valuation Tools Work?
If you’re looking to sell your home, the likelihood is that that you’ve already come across online valuation tools. But what are the advantages of these tools, and just how do they work?
Common sense tells us that anyone who wants to buy or sell a property needs to have some idea of how much said property is worth. Enter… online valuation tools.
As a potential seller, the main benefit of these tools is to provide a quick estimate of how much your present home might be worth. As a possible buyer, you may want to use these tools to discover how the asking price of a home compares with the actual sale prices of similar properties in the same location which have changed hands recently.
But what details might you need to enter? And how is it you can get hold of a valuation for a property when no professional valuer has ever seen it?
Details, details, details
Using Yopa’s valuation tool as an example, the starting point will always be inputting your own personal data. So, to make sure you actually receive the completed valuation, you should be ready to provide your full name and e-mail address along with a contact telephone number. Next, you will need to complete some details about the property itself. Your postcode and house name or number must always be provided to allow any valuer to locate your property, but some other information will be also be required. This will include when your house was built and how long you have lived there, as well as the type of property and details of how many rooms it contains. You may also be asked to describe some other features and amenities the property offers.
Having supplied these details, you should then find the valuation becomes an automated process which delivers your home valuation by e-mail, though some may have an option to phone through the information and thus allow you the opportunity to have a brief follow-up discussion.
The valuation process
Because no one physically visits your home, online valuation sites will invariably rely upon some form of algorithm designed to estimate the value of the property. This will be base on the details you enter, which will then be use to access a range of other comparative data need to formulate a reasonably accurate estimate. The information consulted will usually include: information from the Land Registry about the value of housing transactions which have occurred in the same neighborhood, how much your property sold for previously, a multiplier for any additional work you’ve carried out on the property, together with the current prices of any similar properties which happen to be on sale in that geographical area.
It must be remember , because these figures are not support by a visual inspection, an automate valuation can only make financial guesstimates for the general condition of the property and cannot take in to account any other undisclosed features which may influence the eventual asking price. However, in most instances, an online valuation will still serve as a rough guide which – in many instances – can often be quite close to an actual valuation.
When is an online valuation helpful?
Provided you understand the limits of the information it offers, an online valuation can be useful in a variety of scenarios. For example, if you spot a house for sale which takes your fancy, you can use an online valuation tool to check how the asking price relates to market values in that location. This could help you decide whether to make an initial offer without visiting estate agents or engaging in any in-depth research.
And likewise, if you are mulling over the feasibility of moving to another property, you can quickly access home value information without any need to arrange a home valuation to inform such speculation. Then, when you do appoint an estate agent to value your property, an online valuation can inform any discussion you have by acting as a (virtual) second opinion – especially if there appear to be significant and unexplained discrepancies in the figures.
And finally, online valuations can also offer helpful comparative information to guide your thinking about making home improvements, or deciding what rent to charge if you were to let your home.