Buyers becoming increasingly focused on a property's 'real' value

With capital growth currently suppressed and the investor focus switching to rental yields, buyers are scrutinising their buy-in price now more than ever, according to Propell National Valuers.
However 15 per cent of buyers still pay $10,000 above the real value of a property, Residex chief executive John Edwards told The Australian newspaper last week.
While Propell National Valuers national director Kel Spencer said 15 per cent sounds a bit high and "sensationalised", he also acknowledges that buyers are now increasingly turning to independent valuers and advisers for help to secure and negotiate the real value of a property.
"To determine the real value of a property it's important to analyse the comparable sales in a nearby location and derive land values and building values from that," he said.
Spencer said mortgagee auctions and deceased estates often sell on the day so those sales can even be a little reduced in price and are often ignored in valuations because they're not in ample supply nor typical of prices around.
Valuations generally remain valid for 90 days for market accuracy purposes.
WBP Property valuations manager Brendan Smith said buyers must do their homework, particularly in changing markets.
He said buyers must first become familiar with the market.
"It's not just about turning up to a property… go look at other properties; attend some auctions in the previous weeks," said Smith.