There are lots of people who aren’t aware of this term - ‘Retrospective property valuation’ which is also known as backdated property valuation or historical property valuation. So in this post, we are going to explain what retrospection actually means and how and why it is used?
What is retrospective or backdated property valuation?
When property owner asks for a property to be valued as at a certain time in past or in other words retrospection property valuation is a property valuation at a specific time in the past.
In this process, the property valuer may inspect the property at the current time but asked by a client to evaluate the property value as at a date in the past.
When retrospective property valuation is used?
The retrospective property valuation is used commonly for -
- Capital gain tax purpose (CGT) especially for investment properties.
- Real estate property dispute settlement purpose.
- Family law and separation.
- Stamp duty
Basically, this kind of valuation is critical because CGT liabilities depend on the current value of the property and on how much value has increased over time. Finding the retrospective property value is a challenging task in itself and the ancient unique properties add more challenge to it.
How the property valuers find the retrospective property value?
Like other property valuation methods, the process of retrospective property valuation is similar.
First, the subject property (that is to be valued), dates it is to be valued and condition of the property as at that time (retrospective date) will confirm by the valuer. In short, the property valuer gathers the data related to the property from the retrospective date to till now like what changes have been made in the property as compared to the current position of the property.
After the inspection of the subject property the valuer will review and gather the data of similar property sales that sold around the retrospective valuation date, and on the basis of that information the retrospective market value of the property is evaluated by the property valuer.
The other factors that influence or affect the property value like property market condition and trend, the interest rate at that time are taken into consideration. So the right property value can be evaluated. Basically retrospective valuations for capital gains tax for investment properties, and it is crucial that the value provides a client with a high quality and accurate report to ensure no more tax is paid than necessary.
Though finding the retrospective value of the property is a challenging task requires the experienced and expert valuer and accurate data for precise results.
- The purchased year of the subject property.
- Historical Information from various sources.
- The property price in the sale agreement.
- Information about the major changes took place in the property.
Undoubtedly, the retrospective property valuation or backdated property valuation helps to save the property tax amount, it’s critical to choose a qualified, certified practicing property valuer. Feel free to contact us we provide the best property valuation services. Our team feels happy to assist you.