Broadly speaking, you would need a commercial property valuation if a commercial property is being sold, leased, mortgaged, taxed or insured.
What is a commercial property?
Commercial properties are those used for business. The umbrella is large and may include offices, retail spaces, doctors’ surgeries, hotels – in short, any non-residential property.
Why do you need a commercial property valuation?
A valuation for your commercial property is very useful, whether you’re wanting to sell or rent out. A valuation of this type provides a more comprehensive understanding of the current market value of your property; however, you don’t need to be thinking of selling or leasing to benefit. It helps to keep your accounts accurate, which in turn should save you time and money in the future – from making business decisions, securing funding, having audits looming or wishing to sell.
You would need a commercial property valuation if a commercial property is being sold, leased, mortgaged, taxed or insured.
Selling / Leasing
You would want to know the current valuation to be able to fairly market your property for either selling or leasing. Alternatively, if you were looking to lease or buy yourself, you would want reassurance it is being marketed accurately.
If you are looking for a loan, mortgage lenders always need to know they are lending the correct amount. The more information they have about a property’s value, the more trust they have in the application and more information to work out the loan-to-value ratio.
The Inland Revenue requires current valuations of all assets to determine if any tax payments are due (capital gains, stamp duty, inheritance tax), for accounting purposes.
In order to provide the appropriate cover, insurance companies require an up-to-date valuation.
As with all of these factors, the more detailed information you have to hand, better informed decisions will be made and you will be better equipped to negotiate, if required.
What’s the difference between a residential and commercial property valuation?
Commercial property valuations consider many more factors than residential properties. Residential properties look at location, composition and social factors whereas commercial properties are valued more on its profit-making abilities as well as its construction.
A good valuer will provide you with a report detailing the construction and condition of the property and you should gain a full understanding of the building – location, planning, environmental considerations and socioeconomic factors.
Of course, all valuations are subject to change depending on the economic landscape. A commercial valuation carried out a year ago will probably have changed, so it is worth having another carried out. It is wise to have a RICS accredited surveyor to take out such a valuation.
If you would like more information about commercial property valuations or would like to book my services then please get in touch.