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You've found your dream home and want to get a mortgage to buy it. But first, the bank must send a surveyor to your chosen property. The valuation will consider the property's location and condition and recent sales of similar property to determine its worth.
While property valuation is well-established with its own customs and practices, a UAE company believes there is room for further improvement. By using some of the most common devices and applications available today, such as iPads and Google Maps, it hopes to speed up the process of valuing a property and improve access to market data.
Furthermore, the data gathered could be useful not just for mortgage. By analysing hundreds of property valuations, researchers can even attempt to predict boom-and-bust cycles in the property sector and the economy in general.
There are many benefits of equipping property valuers with tablet devices, says Shahid Kazi, CEO of ValuStrat, the real estate consultancy that is developing the mobile valuation system.
For trained surveyors, the ability to record information directly into the device - instead of using pens and clipboards - means they can complete their reports faster. A previous version of the system used for car valuations cut the delivery time from between one and three days to just two hours.
''It reduces the turnaround time for clients, especially for mortgage valuations, which require a quick turnaround,'' he says.
Clients can benefit from having access to ValuStrat's database, which stores all the valuations of its staff. You want to see all valuations of two-bedroom apartments in Dubai Marina in the past three years? Check the database.
''This would be a breakthrough from the traditional paper-based system,'' he says. ''If clients want to make an organised system, they have to do a lot of manual work. This will be a fully automated system.''
ValuStrat's valuation system is currently being tested internally and Kazi can't say when it will be ready for bank clients to use. He admits, though, that not all banks will find it easy to adapt to the system.
However, Kazi believes the system will be valuable for banks that are aiming for paperless operation.
''That's in sync with what we're offering,'' he says.
For the consumer
If and when ValuStrat gets its system working with banks, the next step could be to extend the service to consumers. Usually, individual buyers only get involved with property valuations when they seek bank financing.
But individuals could request a valuation prior to that stage, perhaps to see if an asking price is fair.
There is a precedent for this: ValuStrat's iPad-based system for valuing cars, which it launched with websites such as Symplfy.com, allows web users to request a valuation of a car. ValuStrat sends out a surveyor, who produces a valuation and sends it to the customer.
Kazi says there is no reason why its property valuation system could not be extended to individual buyers in the same way.
''Once the banks are all up and running, the next step could be giving online access to people looking for property, who want an independent valuation to see if the asking price is reasonable or not.''
ValuStrat is not suggesting its system could become a do-it-yourself tool for valuing one's own property. Users of its iPad system must be trained surveyors, which in the UAE means being qualified by the Royal Institution of Chartered Surveyors and complying with the International Valuation Standards.
In addition, the tool would probably only work for relatively simple residential property. Commercial property or bulk residential projects such as an entire apartment block are generally more complex and cannot be valued using the formulaic approach of a single system. For these projects, surveyors could be expected to use pen and paper for some time.
However, the system could improve the speed and efficiency of property valuations in the UAE, especially if other valuation companies either sign up to it or collaborate on a joint system, effectively pooling their data for the benefit of clients.
As services such as ValuStrat's mobile valuation system produce more data that can be pooled, accessed and compared, it can become easier for property valuers to assess risks in the real estate market.
In the meantime, buyers would do well to remember this mantra of property valuers: a property valuation reflects a particular moment in time, it isn't necessarily a guide to the future.
Click on Property valuations in the UAE to read on an expert opinion regarding property valuations
Source: Mark Gordon, Special to Property Weekly