PHOTO: Capital Values
The relevance of CVs (Capital Values) has been questioned recently. It’s not the first time and I’m sure it won’t be the last, but the one thing I think we have to come back to is that CVs are a great anchor point for market value and, either consciously or sub-consciously, pretty much everyone in the market uses a CV as some form of a guide.
In fact, there are a number of automated valuation models (AVMs) in the market and these models look at the characteristics of properties which have recently sold to calculate a current market value for all properties. One of the key input characteristics for these models? The CV.
The important thing to remember is that no-one expects a property to sell for its CV, because that value is only relevant at the time of calculation. But, what is relevant is what similar properties are currently selling for in relation to their CV.
READ MORE VIA CORELOGIC