Anytime you buy or sell property, you need a valuation. The primary purpose is to find out exactly how much your property is worth. Banks and similar lending companies often require it, before a buyer can obtain a mortgage. The financial institution requires a valuation to ascertain whether the property provides sufficient security for the loan given. It also provides an indication that the property is worth what you are paying for.
A valuation is an “educated and trained opinion” on the value of the property. It also, in some circumstances, may ascertain the best use of the property, garnering the best selling price. For example, a long-time residential property may be in an area that has been rezoned for commercial activity, which could potentially bring in a higher sales price than marketing the real estate to potential residential buyers.
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