How much is your property worth?
In an interview with Charles Mwangi, a valuer with Ruby Land Ltd, we find out how valuation works and why it is an important component of land or property buying.
What is property valuation?
Valuation is an inspection of either land or property using laid down mechanics with an aim of trying to determine its current maximum market value.
How important is valuation?
Valuation helps determine the real property value. In any real estate transaction, valuation plays a crucial element as it helps in unravelling the mysteries surrounding actual property ownership and the forms of ownership.
When you engage a registered valuer, they will advise you on the kind and nature of title, its incumbencies and what this means to the overall property value.
Valuers can tell whether there are grey areas in property ownership since they are trained in collaborating information available on the title with other information available about the same title in survey maps, mutation forms,and registry locations.
Valuation also helps people keep track of their property’s performance within the real estate market. As a property owner, you would always want to know whether the property that you have is increasing or losing value.
Trained valuers are able to keep you informed about the capital appreciation of the properties, as well as the highest and best use policy of property.
Finally all the financial institutions rely on valu-ation to get unchallenged property value. Banks, insurance companies, mortgage institutions, potential buyers or purchasers of the property, insurance companies all rely on valuation.
When working with a registered and licensed estate agent, you get protection from the licensing authorities and the professional body controlling the practice and the risks are highly minimised.
As professionals, valuers are restricted by rules of trade governing professionals and are obligated to conduct themselves professionally and ethically by not charging outside the stipulated fees. Valuers who overcharge are subject to castigation for professional misconduct.
Can valuers collude with sellers to overvalue a property?
The issue of morality and ethics is a societal problem and with greed and corruption, can be compromised. The temptation to overvalue a property is real since the higher the price, the more likely the fees would be.
There are bad eggs in every sector including valuation, where people who are supposed to be professionals collude to misprice real estate.
In many cases when the malpractice is reported or realised, the valuers’ trading certificates are withdrawn or the valuer suspended.
What determines the cost of valuation?
Are there measures in place to check rogue valuers? The Valuers Registration Board (VRB) is the public body mandated to regulate the practice of valuers in Kenya.
Where an individual suspects violation of professionalism either in terms of conduct or the service given, it is good to liaise with this board based at the Ministry of Lands.
The board gazettes the name of registered and practicing valuers every year and members of the public can counter check the names of the valuers they are dealing with against those publicised on the gazette notice.