PROPERTY VALUE & MARKET PRICE
The simple investigation of real estate agencies’ offers is not enough if you want to know the real value of your property. And it’s not enough to make a personal study of the market based on the prices in the area, as soon as they are often distorted and do not match the economic reality: they are always higher for sellers and lower for buyers.
The real market price of a property is determined by a real estate appraisal carried out by an authorized entity with an objective to establish minimum and maximum basing on the annual data of the National Statistics Institute and economic scales, in order to determine the value of a property according to the political-economic situation and the real estate demand.
After these calculations are made, the FINAL and REAL PRICE of the property will be established. In addition, taking into account this data obtained, there will be determined the annual real estate tax, since it depends on the cadastral value that is fixed after appraisal.
REAL ESTATE APPRAISAL
WHAT IS IT?
The appraisal of a property is an official document issued by a technician and/or official company in which the value of the mentioned property is fixed. The appraisal with mortgage purpose is regulated by the Bank of Spain according to the norm ECO/805/2003 that forces to fulfil a series of conditions so that an appraisal could be certified and homologated by a competent organism.
VALUATION OR APPRAISAL?
Very often these two terms are confused. So what is each one, what are they for and how do they differ?
VALUATION OF A PROPERTY only indicates the price of a property and does not require the intervention of a qualified specialist. It is not regulated, nor certified by banks or official bodies. It has no legal validity. It is done for market research, its purpose is merely informative and its price is lower.
REAL ESTATE APPRAISAL officially establishes and certifies the value and price of a property, and it can only be carried out by a competent technician in possession of an accrediting title and based on methodologies expressly defined based on the existence of real estate of similar typology. It establishes legal price, its purpose is economic-legal and its price is higher than that of property valuation.
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