Common Property Valuation Challenges
My years of experience valuing SMSF properties have shown me many challenges that can make the valuation process complex. The ATO
Property valuations form the bedrock of SMSF compliance. Market value assessments, discounted cash flow calculations, and specialised valuation techniques each play vital roles at different stages. The stakes run high – one wrong valuation method choice risks derailing your fund’s compliance status and reporting accuracy.
If you have a property in your SMSF, you are required to conduct an independent valuation on it. SMSF Property Valuations provides valuation services for commercial and residential properties that allow your fund to comply with the ATO and SMSF guidelines.
We do this by conducting a CMA market appraisal of the property in your SMSF supported by compatible data that can be used by the SMSF’s auditors to sign off on your accounts.
We are an independent property firm specialising in providing complaint SMSF valuation reports that pass audit and ATO requirements.
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Reports can take up to 48 hours, however in most cases reports are completed and delivered same or next business day.
SMSF trustees need to consider valuing assets for superannuation purposes every 3 years.
Reports can take up to 48 hours, however in most cases reports are completed and delivered same or next business day.
Property valuations pop up more often than trustees expect. We see four key scenarios:
Annual reviews have now become mandatory, but the approach can change depending on the circumstances.
Most frequent questions asked and answered
Reports can take up to 48 hours, however in most cases reports are completed and delivered same or next business day.
Your report will be emailed to you in pdf form. Please make sure to use a valid and correctly entered email address when ordering. If you discover you have made a mistake, please contact us with your order number.
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There are three main professional valuation approaches used, we prefer teh CMA approach.
The comparative market analysis (CMA) remains the most accessible method in SMSF property valuations. This approach looks at recent sales of similar properties in the same area. It takes into account these factors:
The income capitalisation method works well for commercial properties. This approach determines value based on the property’s ability to generate income. Here’s how it works:
In addition, the capitalisation rate helps show the property’s inherent risk. This method really shines with properties that have unrelated tenants because it gives us objective data to work with.
The cost approach, also called the replacement cost method, helps with unique properties or ones that don’t have much sales history.
The ATO needs valuations to be based on objective and supportable data, whatever method you choose.
The ATO makes it clear that trustees must get objective and supportable market valuations.
Your property might represent much of your fund’s value. This situation calls for a qualified independent valuer. The need becomes even more vital with complex property types or unusual market conditions.
ATO needs detailed written documentation that has:
You must keep records that explain how you determined property values. These documents serve as your best defense during audits.
The integrity of your valuations depends on these quality control steps:
Quality control goes beyond paperwork. ATO emphasizes that valuations must be fair and reasonable, considering everything that affects the asset’s value.
Values that appear substantially inflated or deflated might trigger audits. A single piece of evidence, like a real estate agent’s letter, no longer meets ATO requirements.
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We are an independent online property valuation firm providing compliant SMSF valuation reports that meet audit standards and ATO requirements.
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