Property Valuation For Converting PPOR to IP

Discussion in 'Accounting & Tax' started by BigRed, 23rd Oct, 2020.

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  1. BigRed

    BigRed Active Member

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    Can this valuation be carried out by a real estate agent under a property appraisal report or is there a requirement for a registered property valuer to complete this when converting PPOR to IP?

    Cheers
     
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    It could be. Must must be more than a few line appraisal letter
     
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  3. Scott No Mates

    Scott No Mates Well-Known Member

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    Only a registered valuer can prepare a valuation, a real estate agent can only provide a market opinion unless they are a CPV.

    Which are you after a valuation or an opinion?

    A valuation can be provided at any point in time eg as at 1/7/2016 if that's when you convert to an IP.
     
  4. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    A taxpayer might also self assess if suitable evidence is retained
     
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  5. regalen

    regalen Member

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    Surely a registered/certified property valuer would be required for tax purposes? i.e. if you are looking to determine market value for the purposes of future CGT?
     
  6. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Not a requirement
     
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  7. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Our team does lots of AVMs or deskies for this process

    ta
    rolf
     
  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    See my tax tip on why it may not be good to use a lenders valuation
     
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  9. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Lenders vals are typically "conservative" so lets assume it comes up short $3K. That could translate later into a extra $1,500 that is taxable. So a $500+ cost for a "free" valuation v's paying a reg valuer. I find too that with valuers if they know the primary purpose they will seek to provide a upper end valuation where a lenders val will likley be lower end.
     
  10. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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  11. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    I can see what we are saying here. objectively a decent AVM from a range of lenders will outstrip a full val on average, unless there are unique issues to the stock, or renos or improvements have been made

    Ta

    rolf
     
  12. BigRed

    BigRed Active Member

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    Hey Rolf, could you please clarify what AVM is?
     
  13. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Automated Valuation Model - black box data

    ta
    rolf
     
  14. Wayne Gretzky

    Wayne Gretzky Member

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    Can an independently contracted registered valuer's valuation also be used for a loan increase, or will a bank only increase based on valuations from their network of valuers?
     
  15. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Has to be on the bank's panel and instructed by the bank or broker on behalf of hte bank
     
  16. mr_alex

    mr_alex Well-Known Member

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    Would a Val be needed if you moved back in later? Say you bought a PPOR, lived in it 10 years, rented it for 10 years then moved back in for 10 and then sold, how is CGT calculated and is there a need for a 2nd Val at time of moving in?
     
  17. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    no
     
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