I have been looking for property and come across a nice house in Rivervale 6103, less than 10min drive to Perth CBD. The asking price of this 4x2x2, 2015 built, 218sqm in-built house, on 718sqm land is mid to high $800k.
Before putting in an offer, I purchased the Unimproved Land Value report by Landgate (Western Australian Land Information Authority). The report states the land is valued at $400,000 as of Oct 2021, and the valuation ranges from $400k to $450k in recent 3 years. However, similar size vacant land along the same street is sold at $550k or more in the recent sales (a few months back). In addition, a similar size vacant block in new suburbs 30km further from CBD are selling at a higher price.
My questions:
Why the official unimproved land value is so much lower than the market price?
Does how does the bank do the property valuation? Do they use the official land value?
Thanks in advance.
First time? Valuations on those reports, like valuations on council rates, have absolutely no relevance to market prices. My council valuation is less than half of market value - not looking forward to the day when they finally catch up and charge me double on council rates.
More or less the same with "redbook" valuations on cars. Could be within 10%, or could be 75% higher or lower than market prices.