So I need to do my homework when it comes to buying properties, for a few months now I will practice by going onto the realestate website typing up my area and seeing what properties are for sale and comparing them to try find a intrinsic value. Though I don’t know if I am doing this properly, one thing though do I only compare 1 story house to 1 story house, 2 story house to 2 story house? Is it ok to compare 1 story house to 2 story house?
Is this is the correct way of doing it? :
I go to the real estate website get 2 properties, pretend both 1 story, both 4 bedroom, 2 showers, 2 garages, but land size there is 100sqm difference, is it stuff like this or even air conditioning units whether they exist or not, that I will need to come up with a value? Or do I need to include everything like bedroom sizes, living room size etc?
Or if someone can give me a step by step approach that would be awesome. Thanks.
I think you’re over thinking it a little bit. It’s all fairly simple – just look at what properties are on the market/recent sales and compare any property you’re considering against those. Yes you’ll have to factor in the minor differences of the factors, but this is relatively minor.
If you try to come up with some abstract ‘intrinsic value’ for a property – you’ll probably find you’ve spent too much time, came out with an inaccurate figure and when you offer it to the agent you will get knocked back.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Ah ok thanks. One other question is it necessary to visit homes to find their intrinsic value or is going on a website enough? It seems impossible to find a good guide or anything, no one makes a video showing you know to do it.
I read in this book I think it said you should visit hundreds of home to get comfortable and I think it was talking about intrinsic value.
Are you able to provide an example? If you could post a listing and advise the intrinsic value of it and how you came to that figure, that would be great 👍😎
Ethan Timor | Aligned Finance Pty Ltd
http://www.alignedfinance.com.au/
Email Me | Phone MeActive Investor & Broker; Based in Northern NSW, servicing Australia wide; Author of '34 Proven Ways to Maximise Your Borrowing Power' (download free from our website)
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