When it comes to valuation of a property, it does not matter if you are a buyer or a seller. Valuation of a property needs to be taken into serious consideration so that a buyer can get the best out of his investment without overpaying or paying below valuation. As an investment’s rental yield is based on the purchase price, the valuation becomes the single most important component.
The most common practice in determining the valuation of a property is using the average price of the property transacted in the immediate vicinity of the property concerned. As buyers might be looking for their ideal property, experts warn against paying too high a premium for their dream property due to spur of the moment emotions. This applies to property owners who are looking to sell their property. These owners might attach a premium to their property.
Property experts have pointed out that although sellers sets the price which they would like to sell, it is ultimately the buyer who decides its worth. Therefore, sellers who price their houses above the immediate vicinity price may leave the thought that the property is overvalued and results in no sale of the property.
In the world of free information as well as the ease of information, a buyer who has making an important decision of buying a property must have done his homework in determining the price of a property. Even though a buyer has done his homework, he might buy on impulse. A rule of thumb is not to buy a property which is more than 3% of the average price of a property in the area.
Given that The Hillford is a 60 years old lease private condominium development in the area, there is not a property in the Jalan Jurong Kechil vicinity that we are able to use to determine the valuation of the property.
However, we can extrapolate the surrounding condominiums remaining lease and calculate the valuation based on its ratio. This will give us a good indication of the valuation of Hillford Condo.