Residential Valuation

36310 — Residential Valuation

Valuation for Different Property Types (36300)

Overview

Node 36310 addresses the valuation of residential property — houses, units, townhouses, and other dwellings acquired predominantly by owner-occupiers and residential investors. Residential valuation is the most frequently conducted form of property valuation in Australia, underpinning mortgage lending, taxation, insurance, family law, and probate processes across the largest single asset class held by Australian households.

The direct comparison method is the primary methodology applied to residential property, reflecting the depth of transactional evidence typically available for established dwellings. Where comparable sales evidence is limited, or where a property has unusual characteristics, a valuer may supplement direct comparison with other approaches or apply greater analytical adjustment to available evidence. Residential valuation also engages considerations specific to the sector, including the treatment of strata and community title, owner-occupier versus investment purpose, and the distinction between market value and other bases of value such as insurance reinstatement value.

This node is intended for valuers, lenders, legal practitioners, and other parties requiring an opinion of value in respect of residential property, applying the general methodology addressed in node 36100 and the professional standards addressed in node 36200 to the residential context specifically.

Scope & Boundaries

This node addresses the application of valuation methodology to residential property, including the primacy of the direct comparison method and sector-specific considerations such as strata title and basis of value selection. It does not address general valuation methodology in the abstract, addressed in the 36100 sub-series, or the professional standards and reporting framework applicable to all sectors, addressed in the 36200 sub-series.

It does not address the valuation of commercial, rural, or specialised property, addressed respectively in nodes 36320, 36330, and 36340.

Scope Note

This node describes the general application of valuation practice to residential property as at the time of writing. The specific method and evidence base applicable to an individual dwelling should be confirmed against current comparable sales evidence and the terms of the valuer’s instruction.

Key Concepts

Direct Comparison Method

The valuation approach applied by reference to recent sales of comparable dwellings, adjusted for differences in location, land size, dwelling condition, and other material characteristics, and the predominant method applied in residential valuation.

Comparable Sales Evidence

Recent transaction evidence for dwellings of similar type, location, and characteristics to the subject property, forming the primary analytical basis for a residential direct comparison valuation.

Strata and Community Title Considerations

Additional matters a valuer must address when valuing a unit or townhouse held under strata or community title, including the owners corporation’s financial position, any special levies, and the property’s proportional entitlement.

Basis of Value Selection

The process by which a valuer determines the appropriate basis of value for a residential valuation assignment, distinguishing, for example, between market value for lending purposes and insurance reinstatement value for building insurance purposes.

Regulatory & Legal Framework

State-based valuer registration legislation

State valuer registration boards

(for example the Valuers Registration Act 1992 (Qld) and equivalent legislation in other states and territories) governs who may provide statutory residential valuations.
National Consumer Credit Protection Act 2009 (Cth)

Australian Securities and Investments Commission

Governs the valuation evidence obtained in connection with regulated residential mortgage lending.
Real Property Act

State land titles registries

(state-based, for example the Real Property Act 1900 (NSW) and equivalent Torrens title legislation in other states) underpins the title verification integral to a residential valuation assignment.
Family Law Act 1975 (Cth)

Federal Circuit and Family Court of Australia

Frequently requires an independent residential valuation in support of property settlement proceedings.

Practical Application

Residential valuation practice adapts to the purpose of the assignment and the basis of value the reader ultimately requires.

Scenario	Application	Outcome
A lender requires a valuation to support a residential home loan	The valuer applies the direct comparison method using recent comparable sales evidence	The valuation supports the lender’s loan-to-value ratio assessment
Separating parties require a valuation for a family law property settlement	The valuer prepares an independent residential valuation report addressing market value at the relevant date	The report supports negotiation or determination of the property settlement
A strata unit is valued for building insurance reinstatement purposes	The valuer distinguishes market value from insurance reinstatement value and applies the appropriate basis	The insurer receives a valuation opinion matched to the correct basis of value