IF THE MUNICIPAL VALUATION ON A HOME IS HIGHER THAN THE PRICE ACHIEVED THE BUYER COULD BE FORCED TO PAY TRANSFER ON THE HIGHER FIGURE

Municipal valuations of residential property are time and again a cause of contention, says Lanice Steward, MD of Anne Porter Knight Frank.

“If the municipal valuation of your property is above the genuine market value and you do not get it altered in the next round of revaluations, you could find that when you decide to sell your property the buyer has to pay transfer duty on the higher municipal valuation, not on the price achieved.  This could be a cause of considerable annoyance.”

In these circumstances, says Steward, the agent has a duty to prove that the market price has not been artificially manipulated to achieve a lower transfer duty.  He or she can do this by compiling a comparative market analysis citing the sale prices achieved by similar homes in the area.  It may also be necessary to ask two or three agents to produce sworn valuations of the home, proving that it has not been under-priced.