Based on recent sales at our development of 96 "townhouses" and the neighboring development built by the same developer, I estimate the value of our house at AUD 1.246 million. Now I've come up with an alternative way to value it. We recently had the annual meeting of the body corporate (condo association), which included details of the complex's insurance policy. The buildings are insured for AUD 71.1 million. According to the local government, the unimproved value of the land is AUD 17.2 million. You can get this data from the AllHomes website as shown in the image above. Our share of body corporate fees is 1.32% as this varies by property value. So, the value of our house based on these three numbers is AUD 1.165 million. Our share of the land value is only AUD 227k, which seems very low for a 400 square metre block in this area. As you can see a standalone house block in the top right of the map is valued at AUD 699k. On the other hand, our share of the structure value is AUD 938k, which seems high to me.
2 comments:
Yep, not too sure this would be a more accurate way to 'guestimate' current market value of your home. I simply take my purchase price (assuming we didn't over or under pay) as a fraction of the suburb average house sales price for the past 12 month period, and then use the changes in this monthly data point to calculate a rough estimate of what the current market price for our house might be. It might be an overestimate, as suburb will slowly 'upgrade' the average house due to knock-down-rebuild new homes replacing old homes, extensions being added and renovations done, while our house simply sits here are slowly depreciates (and I do minimal maintenance/renovations/repair).
The problem with using the insured building value as a proxy for house price is that the insurance figure would be designed to provide funds for a 'new-for-old' similar building replacement, whereas the market value is for 'as is' sales price estimation. And the government unimproved land value always low balls actual vacant block sales prices, as it doesn't include the value of land improvements that in reality exist (eg. access to existing sewer lines, roads, power etc.) The two effects *might* somewhat offset each other, but overall I think local suburb recent sales prices are usually a good guide (as long as your home is similar to the properties being generally sold in the area). eg. a large new villa development of medium density might push down suburb average sales prices (especially if a large development is released in one hit), while a spate of know-down-rebuild 'new' homes being sold in an established suburb might inflate the sale price data compared to existing housing stock valuations.
None of it really matters, as the actual price you get net of selling costs is an unknown until you sell it -- so a monthly estimation is really just to track trends and movements, not to provide an accurate 'valuation'.
ps. The insurance and land valuation method would also suffer from being based on an annual step change (for the insurance figure) and four-yearly (at least in our case) revaluation for land valuations by the government, so is pretty low res for trying to do a monthly estimation of value changes. Might be worth using as an annual 'reasonableness check' of the sale price data based estimation (the long term trend from both methods *should* be similar?
I just thought it'd be interesting when I saw the numbers. I only try to value the house annually given the very small number of sales each year in these two developments of about 150 houses that are directly comparable to ours.
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