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When a Real Estate Valuation Expert Witness Is Needed

Real estate matters are important to those that are either selling and buying or seeking investment opportunities. This means that an accurate evaluation or determination of the value of the property must be completed.

A valuation expert is needed to discover the actual value of a house or piece of land. This may be a long process based on certain factors, or it may be a quickly completed action for a professional. This usually is determined through the real estate market, if any upgrades were accomplished, value of the location, condition of the property and similar matters. Before a deal may be closed for a seller, it is crucial that a real estate valuation expert has been hired to ensure the true value may be revealed.

For a buyer looking to purchase a property, the value of the land or housing should be known so that he or she may make an informed decision on the factors that determined the dollar amount. This may then lead him or her understand that some houses are better purchased based on these aspects than a cheaper house in an uncertain location. Neighborhoods
with bad reputations, criminal behavior or where persons are harmed inside and outside of the home should be avoided if at all possible. Investors looking to add their funding to a project may use a real estate valuation expert so that they protect their investment with a property that is worth the invested monies.

What a Real Estate Valuation Expert Does

Most professionals used as expert witnesses or professionals in the field have extensive experience and often years or decades of field work in the subject related to the matter. Those involved in real estate valuation tend to work as a real estate economist, broker with a consulting firm or with real estate agencies for all manner of transactions. This means they have knowledge in property values and value loss, the related industry standards and valuation of both residential and commercial land. With this information at their fingertips, they are able to discern the true and perceived value of real estate for private citizens that own a home or persons in business that have commercial land or property. These individuals may include tenants, homeowners, renters, leaseholders, landlords and similar persons.

Valuation is a delicate science backed by numerous math and economic courses and studies. With knowledge in economics on a small scale, it is possible to discover what the neighborhood value of the property may be in contrast to the dollar amount that the seller has placed on the house or land. If the location is a commercial real estate deal, it must be determined if the landlord or owner is involved. This means that the arrangement may be on a lesser scale if it is leased or rented as opposed to sold. For litigation purposes, this assists a plaintiff if he or she has been wronged in obtaining the market value of the property when cheated out of thousands or millions of dollars due to bad faith business practices.

Needs of Valuation Duties

Real estate valuation is important for two primary reasons when involving either an individual or a company. When a single person is attempting to purchase a property, he or she must know how much the house or land is worth. If the seller is charging a much greater amount, the buyer may decide on another property and save his or her money. Residential houses have various factors that increase or decrease the value based on what affects the price such as renovations, improvements, nutrient rich land and where the house is located. With the assistance of a valuation expert, these elements are calculated with an approximate number.

When the property is a commercial piece of land or buildings, valuation assists the company in determining the perceived and actual value of a portion of the business. This may be beneficial to partners, single owners or if shareholders are wanting details about the value of the organization. In certain situations, the value must be determined so that certain decisions may be made or if the building is more hassle than moving it or tearing it down. A valuation expert may also be used if litigation occurs and the value of the property must be discovered for the case. If that of importance, the actual dollar value may assist in either paying off a plaintiff or to complete certain transactions. The expert witness generally provides testimony in court about the valuation and what assisted in determining the amount.

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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

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