Author: Paul De Gilio

Paul De Gilio is Director at MarketVal National Property Valuers. Paul has been involved with the real estate industry for his entire working life. At various points he has worked in sales, property management, and as a Certified Valuer. The property lists contain all properties Paul De Gilio has sold (in the last 12 months). Join him on Facebook
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Why Most People Will Never Be Great At property valuations sydney

Just quickly gointo property valuations sydney how people can keep themselves safein Australia in this inevitable bubbleburst well first of all you can investin property valuations sydneyreal estate if you know .

  • What you’redoing you’re going to know what you’redoing that’s the problem .
  • Most peoplethat are messing in real estate havezero clue what they’re doing you knowthey’re flipping houses some of .
  • Them but you know are right at the edge of what’spossible they’re hoping
  • That you knowthat Valley will go up all the time sogetting a whole bunch of people that flips.

These houses with the massiveclose to you know they’re just highlyhighly leveraged and suddenly get a dropin price that gets crushed .

They need tounderstand like you can invest in realestate if you know what you’re doingthere’s so much stuff you can go into tounderstand.

how to do properly but ofcourse ?

The most important part is youknow keep yourself free and out of themonetary system you know banks arepreparing to you know take your money atany given time now .

The money a lot ofyeah and online a shadow thecentralization you know the gold andsilver we of course got to make surethat you know you keep yourselfself-sufficient and are not dependent ona government.

When different matterscomes into play and these markets arefreezing up and collapsing you need tobe self dependent because if not you’regoing to sit there and be likeVenezuelans.

That are stuck with you knowa number and a fingerprint that theyhave to give in order to get whateveramount of food that the government willallow them to get yeah it eventually .

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Real Estate Property Valuation – Cap Rate Method

Today government approved real estate valuers gonna be talking about property valuation methods. Property valuers are going to use today is the cap rate.

Cap Rate Property Valuation Method

So basically what the cap rate method is going to tell you is when you buy a property at a specific price what the rental income is returning you annually percentage-wise in comparison to the price if you were to buy the property all-cash it’s a quick way to just go through a property.

And determine its value and you know make an educated decision on whether you want to buy that property and hold it or maybe buy and sell it because the comps are higher in that area.

property valuation, property valuers, property valuation methods

So the formula for cap rate is net operating income divided by the price that operating income is calculated by taking the gross annual income and subtracting the expenses not including debt sir net debt service.

So let’s just make up a situation government approved property valuers have a $, property the rent is and we’ll say it’s a three-bed all right so we want to figure out what the gross annual income is so the gross income is going to be the times minus expenses the expenses are going to be the management the maintenance the taxes the insurance.

And the vacancy so if commercial property valuers add up these expenses percentage-wise what do we get so the you’re getting a Year rent yeah Eyesore gross rent the management is going to be , – maintenance – taxes do taxes on , usually .% to taxes – the insurance – vacancies all right.

So if you add those up you’re going to get your net operating income let’s figure that out right now subtract forty inners subtract seven s subtract that operating income is now how do certified property valuers calculate the cap rate again the net operating income divided by the price.

So Property valuers know this property is going to return us nine thousand one hundred dollars in cash after paying out everyone so Property valuers need to divide that net operating income by the price.

property valuation, property valuers, property valuation methods

So the divided by thousand that you’re paying in cash twelve point two so this property would be a .% cap rate residential property valuers usually buy it ten plus so this would be a perfect property for us to rent out and hold you get that twelve percent.

So if Property valuers take how many years would it take to double our money registered property valuers take eight point one years to double your money with this property plus you’re gonna be raising the rents every year.

So you could probably do it in six years in Sydney most investors are looking for % to % cap rates that’s just not good enough you can do ten plus in multiple markets wasn’t even one of the top markets that we invest in we invest in Sydney where qualified property valuers can achieve to % cap rate.