…and what purpose does it serve...?
An accurate property valuation is defined as the ‘market value’ of a property.
What does this mean ? Market value is the price a property could be sold for within 90 days when placed ‘on the market'.
The best evidence of market value are the most recent transaction prices.
In most countries ‘market value’ is determined by recent transaction prices: the purchase/sale price of the nearest similar property in nearest similar location within the last 90 days. This is not possible in Turkiye because the transaction prices are not yet made publicly available and accessible digitally. That will change, as planned for the future, when the land registries and tax authorities begin coordinating the release of transaction prices. However it is still not available…
Why Expert Appraisal Reports available in Turkiye typically are not accurate.
Initially these reports were required to report transaction values, but the work involved in finding verifiable transactions was too costly, and now these reports are providing valuations based on Average Values or Property Listings, and both methods provide flawed results that are not accurate within 20-30% margin of error, and thus serve very few practical purposes.
What are the most practical uses of a property valuation report ?
For a property seller, an accurate market valuation shows the highest price the property could be sold at now.
For a property buyer, an accurate market valuation shows the lowest price the property could be purchased for now.How is an Accurate Property Valuation Possible ?
Uninformed observers may imagine that determining such prices is merely a matter of guesswork, conjecture, and speculation. This is what agent’s do. This is what ALL residential property valuation services in Turkiye do. The prices charged for such ‘valuations’ are very low, and can be as low as USD 30, but even this price is far too high for such ‘valuation reports' because at best these reports are worthless, and at worst, they are leading to poorly informed decisions that can cost buyers and sellers thousands - those thousands the buyers or sellers never see because the agents disguise the true valuations so to take hidden profits on the price mark-ups.
Uninformed observers, including so called ‘experts', are wrong in imagining it is not possible to determine an accurate market valuation. This is because these observers are not educated in fundamental techniques of economics. In economics, there is a basic analytical technique based on existing market data, that is used to determine the price of anything, and this is known as ‘supply & demand analysis’. The training and licensing of appraisal experts in Turkiye does not include instruction on supply and demand analysis, nor most aspects of economics. As a result, these ‘experts’ are not aware of what this is, nor do they know techniques for applying supply & demand analysis. Unlike the experts at MyTapu Associates, which have been applying supply and demand analysis to property valuations in Turkiye for more than five years, since 2019. The types of property valued in this way have been primarily residential properties: apartments, stand alone villas, construction completed apartment buildings, partly completed apartment buildings, and hotels.
Obtaining these accurate market valuations…
The techniques applied by the experts at MyTapu Associates using supply and demand analysis provide buyers with an accurate market valuation showing the lowest price the property could be purchased for now, and provide sellers with an accurate market valuationshowing the highest price the property could be sold at now, and will be the same price. Supply and demand analysis is the most accurate means of obtaining a market price valuation, in the absence of recent property purchase and sale transaction data in the last few days, and often may be more accurate. Knowledge is money - and obtaining an accurate property valuation is a fundamental and essential requirement to successful investing- consider the 20% difference on a valuation of a $ 100,000 property is $ 20,000 the buyer will not obtain in foregone profit, and the seller will not obtain in sales proceeds.
Why do Smart Investors use these reports ?
Smart investors use these accurate market valuation reports because they have done smart calculations. The difference between accurate pricing and inaccurate pricing is a 20-30% difference in price, and amounts to USD $20,000 on a USD $100,000 property, USD $80,000 on a USD $400,000 property, etc. For an investor that is buying a property, it means avoiding an immediate capital loss and write-off, which happens when paying too high over the market price for a property. For an investor that is selling it means avoiding an immediate capital loss by not obtaining market value, and receiving a price too low and below the market price. In both cases the profit is typically captured by an agent in the form of hidden price manipulation, instead of the investor. This is why smart investors, both buyers and sellers, begin their property transaction with a smart valuation as the very first step. Yes, it is true that this type of smart valuation report requires an average of ten hours of work to complete, and is not available for USD $30, but the value in profits saved is a huge difference in comparison to using an inaccurate valuation report, or blindly relying on an agent's misleading 'advice', which cost the unknowing investors tens of thousands..
Ready for a startling look at the real market value provided by a smart valuation ? Email info@mytapu.com today…
Where to Find Accurate Market Price Information
Placing a property ‘on the market' means making it visible for sale to the buyers in the market. The Turkish market is a bit different than many countries. In Turkiye. More than 95% of all property transactions originate at ‘property portals’, not on agents websites. This means buyers and sellers find each other on property portals, not on agents’ websites or shop windows. This is a very efficient market mechanism for discovering a property’s price: it is very fast, very cost effective (cheap to do), has excellent visibility among buyers and sellers, and is very accurate. A seller placing their property for sale (a listing) on an agent’s website instead of a property portal is actually hiding their property from the general public view and buyers- because very very few buyers look at agent’s websites. And a property buyer looking for a property is actually wasting their time by searching agents’ websites for attractively priced properties because only a very very small proportion of the total number of properties are listed on agents' websites, and Turkish property owners stopped using agents over the last ten years. A buyer will never find a ‘bargain’ on an agent’s website because agents mark-up the listing prices to pocket a profit margin in addition to their commission. MyTapu Associates provides English language services to foreigners wishing to use portals to buy and to sell properties. Add the fact that English language websites in Turkiye of property agents usually have ‘foreign pricing’, which means prices are sold at a higher price tier than prices offered to local Turks, and in specific locations and agents this can be 20% higher than market prices. In conclusion, property prices shown on agents’ websites do not provide an accurate picture of ‘market value’- the property portals do.
Beware the Pretenders…
As usual, three months after publishing this information, it is typical to expect many English language websites of agents to be claiming they are using smart supply & demand analysis for valuations. To determine whether this is true, or not, there is one very simple question an investor can ask them, and the answer will reveal whether they are making false claims…. Email us at info@mytapu.com and request this question which you can use to validate the claims of such advisors. Service providers making false claims are best avoided in all circumstances now and in the future, preventing investor losses.
Read more about property valuations in Turkiye, appraisal reports, eksper reports, and solutions with different types of valuation reports....
Additional Reading- Articles and Web Pages...
- Property Valuations & Appraisal Reports (5 articles)
- Legal Help, Due Diligence, Conveyance (7 articles)
- Tapu Issues (7articles)
- Independent Professional Advice (6 articles )
- Reviews about MyTapu Associates (2 articles)
- Selling property in Turkey (13 articles)
- Read more details in articles...
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