While you are looking for a property it pays to become a knowledgeable in real current market values. This will give you an indication on what your money can buy and ideally is something that you should do right at the start of looking, so you know if you are being realistic, or not.
Once you have received your pre-approval from your Mortgage Broker and have established your price range you need to obtain a list of the most recent sales in the area that you plan on looking for your home in. You can get these from QV or if you are friendly with a North Shore Real Estate Agent they may be able to provide this to you.
How to Establish Property Values
Do not use Government Valuation or CV as a guideline on value! This will prove to be a fatal mistake, you can read about that in my post on Government Valuation does not equal value.
Mark the properties that fit your bedroom and land size criteria then drive by and look at them from the outside making notes on the features, street appeal and condition of the properties. It pays to do a search online for the addresses of the properties online, sometimes there will still be photos or descriptions available which can be insightful.
You will very quickly get an idea on where the property values are and where you can afford to buy what you require in which suburb.
Same Home, Different Area, Different Value
One important thing to remember is that the build cost of a building itself doesn’t go up or down if you build in Northcote or Birkdale, it’s the land value that changes for the location.
While you may not be able to afford a certain house in one area you may be able to afford it in a different area, even if it is relatively close by.
An example of this would be a 1960’s weatherboard bungalow in Birkdale in today’s market will be in the mid-upper $400K range whereas a 1960’s bungalow in the city end of Northcote will be in the high $500 range.
The Secret Property Value Sauce
As you can see there is quite a bit of work involved in this, particularly if you are looking in numerous areas. The best thing you can do is specialise in 1-3 areas only and know the recent sales, streets and area inside out. Don’t cast you net out too wide as it will only confuse you.
Once you have done this you will be able to quickly and easily make decisions for viewing properties and when it comes time to make an offer you will be able to act confidentially and quickly – necessary attributes in today’s market conditions. If you are looking in Northcote you can contact me for one of my Northcote Market Reports, call me on 09 481 0648.