Property Valuation Report Analysis

This assignment requires analysis of a property valuation report for 5 Devonshire Street, Crows Nest NSW 2065. The report provides a market value of $2,085,000 as of September 10th, 2017. The analysis should consider the assumptions, conditions, and limitations outlined in the report, particularly regarding potential issues like landslides, flooding, easements, and environmental hazards. Additionally, the assignment addresses the impact of GST classification on the valuation and emphasizes the report's limited scope, excluding structural surveys.

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
10/9/2017 VALUATION REPORT
Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
5 Devonshire Street, Crows Nest NSW 2065
10-9-2017-2781
Australian Property Institute
EXECUTIVE
SUMMARY
Property Address
File Reference:
Instructing Party:
Purpose of Report:
Interested Valued:
Basis of Valuation:
Description:
Certificate of Title
Details:
Registered Owners:
Limitations,

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Professional Interview Purposes
Simple Resourceful Fee with Free Ownership
Current Market Value
The subject property is an architecturally designed single residential dwelling with a living area of
125m2 built on a 272 m2 plot. Accommodation comprises of a living/dining area, three bedrooms, a
modern kitchen and bathroom. Other improvements include a hallway, entrance, carport, a lawn at the
front, backyard at the rear and a fence. The dwelling is located in an area with integrated public transport
and surrounded by several other similar developments.
Lot 3, Section 2, Deposited Plan 2781
Matthew Phillip Rowe and Lisa Angela Paul
Heritage issues – except & reserving gems and minerals; limiting agreement benefit and burden;
and mortgage
R2 (Single Residential Dwellings)
$206,667 on 7th January, 2001
10th September, 2017
Page 1

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
$800 per week
Direct Comparison Approach
$2,085,000 (Two Million and Eighty Five Thousand Dollars)
TABLE OF CONTENTS
1. VALUATION INSTRUCTIONS.........................5
2. DECLARATION .........................................6
3. BASIS OF VALUATION 6
4. DATE OF INSPECTION/VALUATION 6
5. INFORMATION SOURCES 6
6. LOCATION 7
7. TITLE PARTICULARS 8
7.1. LEGAL DESCRIPTION 8
Page 2
Zoning:
Last Date of Sale:
Date of
Inspection/Valuation
:
Rental Assessment:
Valuation
Methodology:
Valuation:

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
7.2. REGISTERED PROPRIETORS 9
7.3. RESTRICTIONS, INTERESTS, ENCUMBRANCES AND NOTIFICATIONS 9
7.4. TOWN PLANNING AND STATUTORY ASSESSMENTS 9
8. LAND DESCRIPTION AND SERVICES 10
8.1. DIMENSION AND AREA 10
8.2. TOPOGRAPHY 10
8.3. SITE ACCESSIBILITY 10
8.4. SERVICES 11
8.5. FLOODING 11
8.6. SITE IDENTIFICATION AND PLANNING 11
9. ZONING 11
10. ENVIRONMENTAL CONSIDERATIONS 12
10.1. SITE CONTAMINATION 12
10.2. ASBESTOS 13
11. IMPROVEMENTS & PHOTOGRAPHS 13
11.1. GENERAL DESCRPTION 13
11.2. CONSTRUCTION DETAILS 14
11.3. ACCOMMODATION 15
11.4. BUILDING AREAS 17
11.5. CONDITION AND REPAIR 17
12. MARKET COMMENTARY 18
13. RISK PROFILE OF THE PROPERTY 18
14. VALUATION METHODOLOGY AND RATIONALE 19
14.1. BASIS OF VALUATION19
14.2. SALES EVIDENCE 20
14.3. MARKET VALUE ASSESSMENT 27
14.3.1. DIRECT COMPARISON 27
Page 3

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
14.3.2. SUMMATION 28
14.3.3. VALUES RECONCILIATION 29
15. VALUE OF INSURANCE 30
16. VALUATION 31
17. ASSUMPTIONS, CONDITIONS AND LIMITATIONS 31
18. APPENDICES 34
1. VALUATION INSTRUCTIONS
I hereby confirm that I have identified and inspected the residential property located at 5 Devonshire
Street, Crows Nest on 10th September, 2017 with an aim of assessing its market value following the
instructions issued by Australian Property Institute (API) for the purposes of professional interview.
Page 4

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
This valuation report has been prepared in strict compliance with the requirements of the following
organizations, standards and regulations: API, Australia and New Zealand Valuation and Property
Standards manual, and Property Institute of New Zealand (PINZ).
This valuation report has also been prepared for the confidential and private use of the above parties. For
this reason, no one is allowed to reproduce this report in part on in whole or rely upon it for other
purposes or any other party should not use it without getting written permission from us.
The valuation has been completed by following the necessary instructions and using relevant
information obtained from different sources to get as much details of the property as possible. Even
though I have tried to gather all necessary information about the property and verify the data and
material provided, the valuation firm and myself do not accept any liability or responsibility whatsoever
in case I have been provided with incorrect, misleading, outdated or insufficient information.
I also conform that I do not have any monetary conflict of interest that may have affected proper or
accurate valuation of the subject property.
2. DECLARATION
To ensure that I prepare a report that is accurate, complete and relevant, I declare that I have made all
necessary, relevant and appropriate enquiries. To the best of my knowledge, I have not omitted any
significant material from this report, expect as specifically stated otherwise in the report.
Page 5

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
I believe that all the facts that this report contains are true.
Any opinion that I have expressed in this report is impartial and independent.
3. BASIS OF VALUATION
The market value in this valuation has been determined by following the International Valuations
definition that is adopted in the code of professional practice of the API. In this code, market value is
defined as the estimated sum of money that the willing buyer should pay the willing seller in exchange
of the subject property on the valuation date after the seller had done proper marketing of the property
and each party acted prudently, intelligently and without coercion.
Market value is determined on the basis of best and highest use of the property, which does not
necessarily have to be the property’s existing use.
4. DATE OF INSPECTION/ VALUATION
Assessment of the valuation has been done simultaneously with the inspection, which took place on 10th
September, 2017. Because of likely fluctuations in conditions and market forces that are related to the
subject property, this report is only regarded as a representation of my opinion on the value of the
subject property as at the date of inspection and valuation. We also confirm that the photographs
contained in this report were taken on the date of inspection of the subject property.
5. INFORMATION SOURCES
The information used in determining the market value of subject property was obtained from the
following sources: certificate of title (computer register), documents provided by the owner of the
property, sales reports and certificates from different relevant industry sources; property listings and/or
Page 6

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
websites (such as realestate.com.au, property.com.au, domain.com.au, propertyvalue.com.au,
realestateview.com.au, etc.) and North Sydney Council, among others.
6. LOCATION
The subject property in this report is located in Crows Nest NSW, which is 5 km north of Sydney
Central Business District (CBD). This is a suburb that is found on the lower north zone of Sydney. The
suburb has recorded significant growth in real estate market over the past years due to continued
economic and social growth. It is a noteworthy commercial district known for its range of restaurants
and shops. The suburb is well connected with public transport. Some of the major transport routes in the
suburb include Warringah Freeway and Pacific Highway. The new Metro line scheduled to open in 2024
will also have a major interchange and station near Crows Nest. The subject property is 1.5 km to St.
Leonards station. Some of the nearby facilities include: BahBQ Brazilian Grill, Garfish, Small Bar
Crows Nest, The Crows Nest Centre, Sextons Cottage Museum, Royal North Shore Hospital and Big
Music Shop & Studios. Other surrounding developments consist of: duplex, cosmopolitan, semi-
detached, medium – high rise, rail and cafes. There are also several public and primary schools within
the locality. The median monthly personal and household income in the area is $5,403 and $10,945
respectively, the average monthly mortgage repayments is $4,333 and median rental price is $800. In
general, Crows Nest NSW is recommended for families with kids, singles, professionals, retirees,
students and tourists, among others.
Surrounding property and land development mainly comprises of single and two level homes, combined
with homes and commercial buildings still under construction. There are also several lots that are
vacant.
Page 7

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Source: Google Maps 2017
7. TITLE PARTICULARS
7.1 LEGAL DESCRIPTION
After conducting the property’s title search, I found that it is legally registered. The registration details
on the property’s certificate of title are as follows: block description – Lot 3, section 2, plan Deposited
Plan (DP) 2781. The government legal property description of 5 Devonshire Street, Crows Nest NSW
2065 is 3/2/DP2781. The domain property identification (ID) is ZB-2001-DS.
The title search was conducted on 4th September, 2017 and therefore I have assumed, for the purpose of
this report, that the information I got is accurate.
7.2 REGISTERED PROPRIETORS
Page 8

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
The registered proprietors for the subject property are Matthew Phillip Rowe and Lisa Angela Paul as
tenants in common.
7.3 LIMITATIONS, INTERESTS, ENCUMBRANCES AND NOTIFICATIONS
According to the information contained in the certificate of title, the following are the restrictions,
limitations, interests, encumbrances and notifications that are subject to this property:
1. Heritage issues – except & reserving gems and minerals
2. Limiting agreement benefit and burden
3. Mortgage
The certificate title provided does not indicate any other limitations, interests, encumbrances and
notifications or easements other than the ones specified above. If there are any other restrictions,
encroachments, encumbrances, covenants or leases that may be discovered or known other than the ones
specified in this report, I should be advised so that I may assess the impact they may have on the value
of the property. After carrying out relevant investigations, it is our belief that the Restrictive and Caveat
Covenants as listed on the certificate of title do not have a negative impact on the value of the property.
The information above, on the restrictions, interests, encumbrances and notifications of the property,
was obtained from the certificate of title search carried out on 23rd November, 2000.
A copy of title search is attached at Appendix 18.1
7.4 TOWN PLANNING AND STATUTORY ASSESSMENTS
Local Government Authority: North Sydney Council
Classification: Single Residential Dwelling
Rates: $2,266,250 p.a.
Page 9

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
8. LAND DESCRIPTION AND SERVICES
8.1 DIMENSION AND AREA
Identification of the subject property has been in reference to its legal registration details: 3/2/DP2781
(lot 3, section 2, deposited plan 2781). The property is located near the junction of Huntington Street and
Alexander Lane, and is close to Devonshire Street.
The dimensions of the site of the property are as follows:
Boundary Length (m)
Northern 35.8
Southern 35.8
Western 7.6
Eastern 7.6
Total area = 272 m2
8.2 TOPOGRAPHY
The plot is slightly located above the road grade and it is surrounded by similar plots. There are trivial
falls to the north and east following the ridge line and configuration of Pacific Highway.
8.3 SITE ACCESSIBILITY
The main arterial roads to the subject property are: Warringah Freeway and Pacific Highway (Ramos &
Kemp, 2017). Alexander Street and Devonshire Street are the closest collector roads. Minor access
passages are Huntington Street and Alexander Lane. These are one-way streets each with a cycle lane
that allows cyclists to move in opposite direction to the vehicle traffic (North Sydney Council, 2015).
Page 10

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
The streets are sealed with bitumen and have concrete kerbs and guttering. The appeal of the streets is
above average.
8.4 SERVICES
The subject property is properly connected with all essential utility services, including: mains electricity,
natural gas, water, drainage, sewer, data/telephone and cable television.
8.5 FLOODING
As far as I know, the location of the subject property is not prone to flooding. However, I am not in a
position to confirm because we have not conducted a formal flood search for the purposes of this report.
Therefore if this becomes an issue in the future, I should be consulted for comment in reference to this
report.
8.6 SITE IDENTIFICATION AND PLANNING
Identity of the site has been in reference to Deposited Plan 2781
9. ZONING
When carrying out valuation of the subject property, it has been assumed that the property is in full
compliance with the relevant laws, including, but not limited to: current zoning laws, planning
regulations, building laws, land use classification regulations, health and safety laws, fire laws, and other
relevant regulations, codes, rules and orders. The valuation has also been carried out on assumption that
the property does not have any unresolved requisition.
Zoning: R2 (Single Residential Dwellings)
Zoning Effect/Permitted Uses: R2 low density – single residential dwelling
Current Use: Residential
Page 11

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Building Style: Single storey
Building Nature: Detached
Other permitted use with development approval: boarding houses, bed & breakfast accommodation,
group homes, community facilities, childcare centres, swelling houses, dual occupancies, recreation
areas, health consulting rooms, etc.
LGA: North Sydney
If there is any inaccuracy in this planning information that was relied upon when undertaking the
valuation, the valuer should be consulted so as to comment on the same and probably make necessary
amendments.
10. ENVIRONMENTAL CONSIDERATIONS
10.1 SITE CONTAMINATION
During my inspection, I did not find any perceptible signs of contamination of the site. In this regard,
there are no formal tests that have been conducted.
Construction of the subject property was done between 1910 and 1915, followed by some improvements
in 1997. At the time of carrying out the inspection, I do not have any knowledge of site contamination;
but I am also not aware of the site’s full history.
If, after releasing this valuation report, site contamination is found to be in existence, this is likely to
have an impact on the assessed property value, which will resulting a conceivable decrease in valuation
figure. This valuation has been done on the basis that the site is not contaminated. Therefore if a formal
test, such as soil survey, is carried out and contamination of the site found to exist, I should be consulted
for comment on this valuation.
Page 12

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
10.2 ASBESTOS
From the inspection I carried out on the subject property, I did not find any information showing
evidence that asbestos or its related products were used in construction. Nevertheless, I have not
examined invisible or unreachable areas of the improvements. Considering the time when the
improvements were done, it is unlikely that there is presence of asbestos. In this regard, the valuation
was carried out on assumption that health risks associated with asbestos, which could have an impact on
the value of the property or its marketability, do not exist.
11. IMPROVEMENTS & PHOTOGRAPHS
11.1 GENERAL DESCRIPTION
The property being evaluated and valued in this report consists of a detached single residential house
that is within walking distance to Devonshire Street, Huntington Street and Alexander Lane.
The house was built between 1910 and 1915 but went a significant improvement in 1997. Its floor plan
layout and general design is purposeful and practical for its use and age respectively. Most of the
fixtures, features and fittings of the house, including ceiling, lights, walls and features in the kitchen,
bathroom/laundry, bedroom and living/dining area re up to modern standards.
Page 13

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Façade to Devonshire Street Rear Backyard
11.2 CONSTRUCTION MATERIALS
Below are some of the construction details of the house:
Builder: N/A
External walls: Unrendered brick
Internal walls: plastered brick and plaster board
Window frames: Timber
Floors: Timber (bares and joists)
Roof: Terracotta (TC)
Floor coverings: Porcelain tiles and carpet
Ceiling: tray ceiling
Internal and external condition: Good
Page 14

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
11.3 ACCOMODATION
The subject house provides average accommodation consisting of a patio, entrance a family room
(living/dining area), three bedrooms with built-in wardrobes, a kitchen, a hallway, bathroom/laundry and
a carport.
There are steps at the main entrance and others leading to the kitchen and family room. All the three
bedrooms, the bathroom, kitchen and family room can be accessed from the hallway. The kitchen
contains several fittings including ovens with induction and gas cook tops, range hood bench top,
essastone bench hood, drawers and cabinets. The bedrooms comprise of built-in wardrobes, cabinets,
racks, chair and a counter/workbench/worktable. The property also has a well maintained garden and
lawn both at the frontage and back. Other features and fixtures include security system, heritage and
single carport.
Living Area Master bedroom
Page 15

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Bathroom Kitchen
Site Access Backyard
Other fixtures and fittings of internal accommodation comprises the following:
Hallway: timber flooring, plastered walls and tray ceiling mounted with LED lights.
Bedrooms: built-in wardrobes, wooden flooring, carpet, shelves, racks, chair, workbench, plastered
walls and LED lights.
Page 16

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Bathroom/laundry: porcelain tiles, washing machine, air conditioner, bathtub, shower, washbasin/sink
with essastone top, drawers, cabinets, mirrors and LED lights.
Family room/dining: timber floor, tray ceiling mounted with LED lights, plastered walls, cabinets, and
heating, cooling and air conditioning system.
Kitchen: ovens with induction and gas cook tops, range hood bench top, essastone bench hood, drawers
and cabinets.
Additional improvements include carport roof, alarm system, skylight and fencing.
11.4 BUILDING AREAS
Based on the floor plans that were provided for use in this evaluation and from the measurement checks
done on site on the date of inspection, the sizes of main components of the building are as follows:
Main living area 125 m2
Hallway 17.67 m2
Entrance 6.77 m2
Carport area 13.75 m2
Total Building Area 163 m2
A copy of floor plans of the property are attached in Appendix 18.2
11.5 CONDITION AND REPAIR
I have extensively inspected the interior and exterior of the subject property. From my inspection, I have
found that appearance of all improvements shows that they are in good condition. Even though I have
not carried out any structural test or survey, there is no any sign that the property is affected by structural
defects such as pest infection or rot. However, I do not have requisite qualifications to authoritatively
Page 17

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
comment on these issues. I always recommend that a building report should be prepared to certify a
property’s structural soundness but I also do not have any reason to be doubtful of any major problems.
Also, none of the building services underwent any formal tests.
12. MARKET COMMENTARY
According to Real Estate Institute of NSW, the median house price in Crows Nest is $2,150,000 and the
area’s average capital growth is 9.64%. The real estate sector in the region has recorded a growth of
22.86% over the past 12 months.
These statistics show a strong, stable and growing demand for housing in Crows Nest, which has a
positive impact on median house price. Both rental and buying markets are continuing to perform well,
making the area ideal for real estate investment. The gross rental yield in the area is 2.30%. The ongoing
infrastructure and commercial development are also making the residential market in the area to be more
promising in the near future.
Therefore because of these market dynamics, interest rates are expected to continue fluctuating within
short terms thus having significant impacts on house prices.
13. RISK PROFILE OF THE PROPERTY
I have complied risk profile of the subject property using SWOT (strengths, weaknesses, opportunities
and threats) analysis as follows:
Strengths
 Closeness to restaurants, cafes, bars, primary and secondary schools and various recreational
facilities and parks.
 Located in a place with an integrated public transport system.
Page 18

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
 Surrounded by developments consisting of similar houses.
 Low interest rates on mortgages.
Weaknesses
 The size of bedrooms is relatively low and their layout is inappropriate for modern homes.
 Outdoor space and amenities are limited.
 The house prices in the area are still low despite ongoing economic developments.
 Local streets are small and one-way restricting movement and type of vehicle that the occupant
must own.
 The dwelling has only one parking space that is considered small.
Opportunities
 Ongoing and planned developments and infrastructure will increase house prices in the future.
 Area rapidly becoming an economic hub in North Sydney and attracting both local and non-local
residents.
Threats
 Traffic congestion is likely to increase due to growing population.
 Interest rates on mortgages is likely to increase due to growing economy and increase in house
demand within the region.
14. VALUATION METHODOLOGY AND RATIONALE
14.1 BASIS OF VALUATION
Assessment of the property in this report has been done in consideration of the following factors:
Page 19

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
 Location of the property and nearby land uses
 Zoning of the land
 Size, topographical features and configuration of the land
 Zoning of the land
 Construction, age, type and condition of the property improvements
 Design, functionality and utility of property improvements
 Accessibility and provision of utility services for the property
 Available and recent sales of similar properties nearby the subject property; and
 The overall residential property and/or real estate market in NWS especially on supply and
demand within Crows Nest area and its environs.
To come up with the market value for the property in this report, I have painstakingly and concisely
researched and analyzed sales of several similar properties within reasonable proximity with the subject
property.
The approach of analyzing direct sales of similar properties is very common and reliable when
determining a reasonable market value of a residential property. That is why I employed this approach in
coming up with the market value of the property as at 10th September, 2017. The secondary check
method used in this valuation is summation method.
14.2 SALES EVIDENCE
To come up with the market value of the subject property, I have considered several sales transactions of
similar properties within the neighborhood. Details of these sales transactions are provided below. These
sales are considered to be among the most recent and relevant ones in the area. The information used to
analyze these transactions have been obtained from different sources. I believe that the information I
Page 20

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
have used is accurate but formal verification of all details has not been done. Inspection of these
properties was only done on their external features and conditions.
Property Address: 46 Holtermann Street, Crows Nest, NSW 2065
Sale Date: 9/6/2017
Sale Price: $2,000,000
Land Area: 177 m2
Year built: 1910
Analysis:
Sale $/m2 Land: $11,299/m2
Page 21

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
The property is a Federation style single residential dwelling (zoning R2) comprising of 3 bedrooms (a
master bedroom and 2 large bedrooms), 2 bathrooms, living area, courtyard, kitchen and several features
(such as air conditioning, gas cooktop, sky-lit attic area, etc.).
In comparison with subject property:
It is considered comparable to the subject property because of similarities in location, size of plot,
zoning, features and fixtures, and surrounding developments.
Property Address: 8 Slade Street, Naremburn, NSW 2065
Sale Date: 20/3/2017
Sale Price: $1,990,000
Land Area: 332 m2
Year built: Unavailable
Analysis:
Sale $/m2 Land: $5,994/m2
Page 22

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
The property is a single residential dwelling (zoning R2) comprising of 3 bedrooms, 1 bathroom, formal
lounge, family room, kitchen, verandah, several features (such as modern lights, air conditioning, timber
bench tops, etc.) and 1 car parking. It is located in a convenient and leafy environment.
In comparison with subject property:
It is considered comparable to the subject property because of similarities in location, size of plot,
zoning, features and fixtures, and surrounding developments.
Property Address: 99 Atchison Street, Crows Nest, NSW 2065
Sale Date: 20/4/2017
Sale Price: $1,975,000
Land Area: 177 m2
Year built: 1985
Analysis:
Page 23

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Sale $/m2 Land: $11,158/m2
The property is a semi-detached dwelling consisting of 3 built-in bedrooms, 1 bathroom, modern
kitchen, chic master, kitchen, paved alfresco, 1 car parking space, understair storage, guest w/c, private
garden and several features (such as stainless steel gas cooktop, modern lights, air conditioning, modern
fittings, gas bayonets, etc.). It is located very close to the CBD.
In comparison with subject property:
This property is comparable to the subject property because of similarities in location, plot size, zoning,
internal and external features and surrounding developments.
Property Address: 41 Palmer Street, Cammeray, NSW 2062
Sale Date: 13/5/2017
Page 24

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Sale Price: $1,920,000
Land Area: 346 m2
Year built: Unavailable
Analysis:
Sale $/m2 Land: $5,549/m2
The property is a modernized and extended house within five minutes’ walk to village cafes, shops,
buses, schools and expressway. It comprises of 3 double beds, 1 bathroom, flowing lounge/dining,
modern bathroom, modern gas kitchen, study area, rear laundry, loft access, etc.
In comparison with subject property:
This property is comparable to the subject property because of similarities in location, plot size, zoning,
internal and external features and surrounding developments.
Page 25

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
Property Address: 8 Raleigh Street, Cammeray, NSW 2062
Sale Date: 20/2/2017
Sale Price: $2,150,000
Land Area: 259 m2
Year built: 1930
Analysis:
Sale $/m2 Land: $8,301/m2
The property is a renovated and modernized house in a luxuriant cul-de-sac village in Cammeray. It
exhibits a wide range of original features and is in close proximity to cafes, schools, buses, restaurants,
shops and CBD. It consists of 3 double beds (2 built-ins), 1 bathroom, central lounge, open plan dining,
modern bathroom, laundry, veranda, front garden, modern kitchen, attic, etc.
Page 26

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
In comparison with subject property:
This property is comparable to the subject property because of similarities in location, plot size, zoning,
internal and external features and surrounding developments.
14.3 MARKET VALUE ASSESSMENT
The subject property’s market value has been determined following the Guidance notes and Professional
Practice Standards of API.
According to the applied guidelines and standards, the best method of carrying out valuation of a single
residential dwelling is through direct comparison approach. In this method, direct comparison of sales of
similar properties in the same area is done with the subject property for the purpose of determining the
current reasonable market value of the subject property. This is then settled and supported using a
secondary check method, which is usually summation approach.
14.3.1 DIRECT COMPARISON
The direct comparison method (per m2 of improved land area) is the primary valuation method that has
been used in carrying out this valuation. The method basically entails making negative or positive
changes between the selected comparable sales evidence (discussed in Section 14.2) and the subject
property. Various differences between the subject property and sales evidence are considered, including
location, size and quality of land area, size and quality of the dwelling, existing, ongoing and planned
infrastructure developments and house improvements, among others.
To come up with the current reasonable market value of the subject property, I have comprehensively
assessed the sales evidence of similar properties (as detailed in Section 14.2 above) with several other
sales transactions that were completed within the neighborhood. In some cases, I have also discussed
Page 27

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
with property agents in the area. I have obtained relevant information from a variety of sources in order
to perform the analysis and I believe that the information used is accurate, correct and updated, even
though I did not formally verify all details. Also in some cases, I did not manage to inspect internal
properties, features and conditions of the dwellings but I ensured that I perform thorough external
inspection for the purposes of undertaking the valuation.
From the sales evidence considered in this valuation, the values of properties analyzed range from
$5,500 to $11,300 per m2. On the basis of the direct comparable sales evidence that I have analyzed in
Section 14.2, I have used a rate of $7,665 per m2 for the subject property in this valuation.
DIRECT COMPARISON
Total Building Living Area 125 m2
Applied rate per m2 of improved land area (272 m2) $7,665
Total value $2,084,880
Rounded to $2,085,000
14.3.2 SUMMATION
The secondary or check approach that has been used in this valuation is summation method. In this
method, the subject property’s unimproved market value is determined by analyzing sales of comparable
vacant land from within close proximity. The land component’s derived value is then summed with a
representative amount of the improvements’ depreciated value so as to obtain the total added value. As a
check approach, I have also used knowledge of construction rates within the locality from preceding
property valuations and building costs in Crows Nest.
Page 28

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
In evaluating the subject property’s unimproved land value, I have assessed the property against recent
sales of vacant land within Crows Nest. In my opinion, the land value of the subject plot is a reasonable
figure and is a reflection of similar rates of vacant lands at Cammeray and Naremburn that are located
close to the subject property. Using this evidence, I am satisfied that the assigned land rate of $3,455 to
the subject land is suitable and reasonable for the purposes of summation.
SUMMATION
Quantity Rate Total Summation
Value of Land 272 m2 $3,455 $940,000 $940,000
Value of Building 125 m2 $5,180 $647,500
Value of Other Improvements
Hallway 30.8 m2 $3,650 $112,420
Entrance 11.0 m2 $3,150 $34,650
Courtyards 26.25 m2 $2,620 $68,775
Carport 13.75 m2 $3,250 $44,688
Ancillary Improvements 15.45 m2 $10,850 $167,633
Total Improvements Value $1,075,666
Total Value of Land, Building and other
Improvements
$2,015,666
14.3.3 VALUES RECONCILIATION
Direct comparison method: $2,085,000
Summation method: $2,015,666
Page 29

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
The difference between the figure obtained from the direct comparison method and summation method
is relatively small hence the valuation methods are reconciled. Nevertheless, I consider direct
comparison method that uses sales evidence as the more reliable valuation method, though summation
approach is used as the valuation’s secondary check method. The reason why I have relied greatly on
direct comparison method is because it considers prevailing market conditions that directly affect
property value. In other words, I consider summation method to be a theoretical approach and direct
comparison method to be an experimental approach. Therefore I have taken the figure of $2,085,000
(Two Million and Eighty Five Thousand Dollars) as a representative of the subject property’s current
reasonable market value.
15. VALUE OF INSURANCE
I have also estimated a replacement insurance cost on the assumption that the subject property is totally
destroyed by means such as fire, earthquakes or flooding a day after the current insurance policy expires
and made variations to cater for demolition and accommodation costs when a new house is being
constructed.
Before constructing a new house, any structure that is left behind would be demolished and removed
from the site. In assessing the insurance cost, I have included allowances for the following: professional
fees, inflation, debris removal and current rebuilding cost over insurance policy period and re-
construction period.
The replacement cost I have estimated is based on construction of a new building of modern
architectural design to replace the existing house’s gross floor area. The figure is close to: $750,000
(Seven Hundred and Fifty Thousand Dollars) exclusive of GST (Goods and Services Tax).
Page 30

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
I must also state that I am not a professional quantity surveyor and therefore the construction cost
estimated here is based on information of local construction rates obtained from preceding valuations in
Crows Nest. In this regard, I recommend that, if appropriate, services of a qualified quantity surveyor be
sought after so as to verify the insurance cost for the replacement.
16. VALUATION
After considering different factors mentioned in this report, including sales evidence of similar
properties in Crows Nest, I hereby express my opinion that the current reasonable market value of 5
Devonshire Street, Crows Nest NSW 2065 as at valuation date of 10th September, 2017, excluding GST,
is:
$2,085,000
(Two Million and Eighty Five Thousand Dollars).
17. ASSUMPTIONS, CONDITIONS AND LIMITATIONS
This valuation has been carried out on the basis of information obtained from different sources including
Certificate of Title and inspection of the subject property, and is not affected by other issues besides
those mentioned herein.
Any comments that have been made on the matters itemized below are based on realistic site
observations and appropriate oral enquiries (where necessary) devoid of the benefit of surveys, searches,
reports of experts, relevant authorities’ responses, etc. I must reiterate here that I am not an expert in the
matters listed below but it is my opinion that the comments I have made about them in this report are
correct. This valuation should also not be relied upon if the client or his/her representatives obtains or
Page 31

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
carries out surveys, searches or other responses that may have contrary information about matters that
have not been addressed in this report.
 Landslide and flooding
 Acquisition of main road
 Encroachments
 Heritage issues
 Electrical easements
 Pests
 Rail
 Environmental hazards
This valuation has been done on the basis that the subject property is GST free. I am not a financial
expert and do not have all financial details of past or current owner(s) transactions that may have an
impact on the property status in correlation with GST. If the property does not eligible to be classified as
GST free, I must be consulted in reference to this report so that I can give my comments on this issue.
This valuation report has been prepared only for use by the party to who it has been addressed.
Therefore I do not accept or contemplate any responsibility for any part or whole of the valuation
report’s contents to any other party that may choose to use this report without this Company’s written
consent.
The party of whom this report has been prepared for intents to use it for carrying out a professional
interview analysis. Therefore third parties will not accept or undertake any responsibilities associated
with it.
The report does not encompass a structural survey of the subject property.
Page 32

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
For any part or whole of this report to be used or referenced in any published statement, circular or
documents, a formal approval must be obtained from this Company.
I hereby confirm that all photographs attached in this valuation report are real and were taken on the date
of inspection, which is stated in Section 1 of this report.
The information contained in this report is only current as at the date of valuation. Having said that, the
market value quoted herein can change significantly and suddenly over a short period of time, due to
various factors, including fluctuating market conditions.
I confirm that I inspected the subject property personally on the date which the valuation was undertaken
and have assessed relevant documents attached as at that date. None of the members of this Company,
including myself, have any conflict of interest, or financial, direct or indirect interest in relation to the
subject property that has not been disclosed in this report.
The evaluated market value of the subject property is based on an anticipated selling period of three
months or less.
18. APPENDICES
Page 33

Valuation report of 5 DEVONSHIRE STREET, CROWS NEST NSW 2065
APPENDIX 18.1 CERTIFICATE OF TITLE
APPENDIX 18.2: BUILDING FLOOR PLANS
Page 34