A Valuer is a person whose job is to estimate the value (price) of something (i.e. property) that is to be purchased inter alia. The process of estimating the value of something is called valuation. Availability of property values (prices) enable exchange to occur in the market. Thus, Valuers and valuation are important in the price discovery process in any imperfect market where price data is hard to come by.
Two or more Valuers will often give you different values for the same property. This variation in values is primarily due to the imperfection of the property market, typified by access to unequal information. Therefore, a certain range of values may be accepted.
However, what happens when the Valuer's estimate of value is inaccurate? A study by Awuah et al (2016) showed that there are serious concerns over the standard of property valuations produced in Ghana. These concerns relate to valuation errors, in particular, wide variation in valuations. In terms of statutory valuation, they found out that valuations of two valuers were averagely over 60% apart. This means that valuations are uncertain and misleading.
Why are Valuers confusing buyers and sellers in the property market with inaccurate values?
Are these errors part of the reasons for the ever-increasing property values in Ghana?
If the very reason for the emergence of the Professsional Valuer is violated, what then is the use of Valuers and their valuations?
