A valuation report is not about the price you hope to get. It is a document the notary, the tax office and the bank need, and the figure in it is calculated by its own rules. Below: when a valuation is mandatory, who may produce one, and how to tell whether the number in the report is sensible.
When a valuation is mandatory
Four cases where the deal will not go through without a report. A sale or a gift through a notary: the tax is based on the valuation. Inheritance: the notary calculates the payments from it. A mortgage: the bank will not release money until it sees the valuation of the collateral. A court case, for example division of property.
In other situations a valuation is optional but useful: when the owner has no idea what to ask, and when the two sides disagree about the price.
Who may carry out a valuation
Not an agent and not a neighbour. A valuation is produced by a certified appraiser listed in the state register. The report carries the certificate, the seal and the registration number, and that number is what the notary checks.
A report that is not registered in the single database will be refused by the notary. That is the most common reason deals get postponed: the valuation exists, but the register has no record of it.
What moves the number
District, floor area, storey, condition, building type and year of completion. The appraiser compares the property with what has been sold nearby and applies adjustments.
District matters most, and the market numbers show it plainly. A square metre in Arcadia now averages about 2064 dollars, on Fontan 1643, in the Prymorskyi district 1584. At the other end: Moldavanka 987, Slobidka 982, Kotovskoho 977, Cheriomushky 968, the Peresypskyi district 967. The gap between top and bottom is more than twofold, and no adjustment for renovation closes it.
How to sanity-check the valuation yourself
Take the floor area of your flat and multiply it by the average price per square metre in your district. That is your benchmark. If the report differs from it by more than a quarter, ask the appraiser which adjustments were applied.
The second benchmark is the type of housing. A square metre in a new development costs about 1557 dollars, in resale housing 1198. If a flat in an older building was valued at new-build rates, or the other way round, it is worth asking what it was compared with.
Current apartment prices in Odesa are updated daily and make this check easy before you talk to the appraiser.
Why a valuation and a market price are different numbers
A valuation states what the property is worth under a methodology, on a specific date. The market price is what buyers actually pay today.
They drift apart constantly, and that is not an error. An appraiser relies on completed deals, and those reflect the market with a delay. So in a rising market the valuation is usually below the market, and in a quiet one it can be above it.
For tax, the valuation is what counts. For negotiating with a buyer, the market price is. They should not be confused.
What to do if the valuation came out low
Read the report first instead of arguing with the total. It lists the comparison properties. If the appraiser used flats in worse condition or in another district, that is visible at once and can be raised.
Second: check whether your investment is reflected. Renovation, built-in appliances, autonomous heating and a parking space all affect the sum, but only when they are documented and visible during the inspection.
Third: remember that a low valuation reduces the tax, and also the amount the bank will lend to your buyer. It is not always in your favour.
Why a one-bedroom is valued higher per square metre
Owners of three-bedroom flats are often puzzled: the one-bedroom next door was valued at 1390 dollars per square metre, theirs at 1228. There is no mistake in that.
A small flat is always more expensive per square metre, because the kitchen, the bathroom and the hallway take up a larger share of its area. It has less usable living space per metre, and demand for it is higher: Odesa currently has around 1508 one-bedroom flats on the market against 805 three-bedroom ones, and they are bought both to live in and to rent out.
So comparing the price per metre of a one-bedroom with a three-bedroom makes little sense: they are different products with different demand. The comparison should be with flats of the same size in your own district.
How long is a valuation report valid?
Six months from the date of valuation. After that a notarial deal needs a new report.
Can a valuation be done without visiting the flat?
Formally yes, from documents and photographs. Without an inspection the appraiser cannot judge the condition, so the figure will be more conservative.
Who pays for the valuation in a sale?
By agreement. Usually the seller, because the report is needed for the seller tax, but the parties can agree otherwise.
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