Claire Aumont our resident property expert from estate agent Monde Avenir answers this month’s hot property question.
How is a property valued and can there be a huge difference between two valuations?
In Luxembourg, there are neither regulations nor guidelines for evaluating a property, and this can create huge discrepancies between two valuations of the same property.
Here are the factors to take into account when evaluating a property:
- Like everywhere else around the globe, the price of a property depends greatly on its location. City centre locations or ones close to important schools such as St Georges or the European School in Mamer will always command higher prices.
- The general state of the property, its size, its age and its energy passport are all contributing factors.
- Unfortunately some “improvements”, such as converting a bedroom for a larger bathroom, and more particularly personalized interiors do not add to the value of a property and can even bring the price down. Some buyers are demotivated when there is too much work required to put right a property. If you are buying rather than selling a property, this can work in your favour if you are prepared to invest in fixing up a home and happy to put up with any disruption it will cause.
- Since the market is based on the balance between the offer and the demand, what the market has to offer at a point in time, also impacts the valuation of a property. So if there are several properties for sale in the same area, of a similar size and condition then this might bring the price down. Equally if a property has been on the market for several months and you are interested in buying it, you can reasonably make an offer below the asking price, although this may not be accepted.
Unlike in other countries, sale prices are not disclosed publicly so only the “Bureau de l’Enregistrement et des Domaines” (tax office), notaries and estate agents know how much sold properties go for.
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