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What is a property history report, and how can it help you?

What is a property history report, and how can it help you?

If you’re in the early stages of purchasing a property you may be curious to the history of the home you’re considering buying. After all, how can you move forward with a property if you don’t know its past, including rental yields and growth of its market value?

How can a property report help potential buyers?

Conducting a property history report can assist buyers with just that. By researching key facts of the property, including sales value history, valuation history, rental history, or current price estimates, you can paint a more detailed picture of the value of a property and potential return it may yield.

If you’re planning on using the property for investment purposes, it’s important that you can gauge potential rental returns based on historic and current rent prices. This includes data not just from the potential property, but similar properties in the same suburb.

For both investors and owner-occupiers, learning the property value history can help you to better understand not only how much the value has increased since it was built, but how much similar houses may have grown or fallen in value and sold for recently. All of this can help you to make a competitive offer on the property or be used as a bargaining tool, particularly if prices are falling in your potential area.

Benefits of comprehensive property history reports:

  • Identify historic rental prices and calculate potential returns
  • Identify historic appraisals
  • Identify what the property has sold for in the past
  • Identify how many times a property has sold
  • Identify how long it has previously sat unsold on the market
  • Identify information around similar properties on the same street or in the same suburb

How to conduct a property report

Unlike sourcing your credit history, for example, there’s no one ‘property history report’ you can run for a listing you’re interested in. In fact, it may take a little bit of research to get all the information you’re after.

However, websites such as RateCity offer a comprehensive analysis of the property market that can be used to create a report. This includes historical property valuations, property sales history, and rental information. By collating this information, as well as data provided public records offices, you can create a better understanding of the property you intend to purchase.

RateCity provides retrospective property information to would-be buyers for free based on providing a property’s address. A profile of the property is then created, which includes helpfiul information like:

  • Property details – Number of bedrooms, bathrooms, land size etc.
  • Property value report – Includes estimate low, moderate and high value range you may expect on this property.
  • Sale history – Past property sale prices and years it was sold.
  • Suburb sale information – Recent sale values of similar properties nearby

Real estate websites may also be able to assist in building out your property report by providing:

  • Rental history – public listings of rent prices
  • Suburb rental information, including current advertised rental prices of similar properties nearby
  • Nearby schools
  • Suburb population information, including median house and unit prices, age and demographics of residents
  • Market trends – typically graphs sale or rent prices over several years

Government platforms and public records

State and territory governments keep records of property sales, title transfers and other important information you may be searching for. While it may cost a small fee to obtain the information depending on your state or territory, it may help paint a more detailed picture of your potential property.

This can be particularly useful for older homes, as most property listing websites may only provide data for up to last decade, if not shorter. Get in touch with your local State Records office for more information.

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Fact Checked -

This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.

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Learn more about home loans

What is a property report estimate?

A property report estimate is an approximate calculation of a property’s value, found in an online property report. These estimates are typically based on the property’s age, size, location, and number of bedrooms, bathrooms and car spaces. The property’s history of previous sales, plus recent sales of similar properties in the local area, may also help to calculate the property’s current value. 

What is my property value?

Your property’s value is how much your property is worth to a bank or mortgage lender, when it comes to securing a mortgage over a property and calculating the loan to value ratio (LVR).

A professional valuer assesses a property’s value based on data about the property, its sale history, and other recent sales in the area. The valuer may also visit the property to assess its condition in person.

A property’s value may be different to a real estate agent’s appraisal, which indicates how much a property may sell for. It’s also often different to a property’s sale price at auction or private sale, which shows how much a buyer thinks it’s worth in the current market. 

Is it free to get your house appraised?

A house appraisal, in which a qualified real estate agent assesses a property to make an estimate of its value, is a service that is generally offered to homeowners free of charge.

Local real estate agents tend to offer free property appraisals to homeowners as a way to build a relationship with them, and potentially secure the listing if the homeowner has plans to sell.

It can also be a good opportunity for the homeowner to gauge the agent’s level of expertise and determine whether or not they would be an ideal listing agent for the sale of their home.

You may also like to consider using an online service like RateCity to get a free property value report. Similar to an appraisal, the report is a computer generated valuation based on a significant amount of data and insights, and can provide details including the estimated property price and information about similar properties for sale or recently sold in the area.

How much is my house worth?

Your house’s worth may depend on its age, size, location, and overall condition. This may be affected by its number of bedrooms, bathrooms and car spaces, as well as its previous sale history, plus recent sales of similar properties in the local area. A property report provides a summary of this information to help you make an estimate.

You may get a different estimate of how much your house is worth if you ask a real estate agent, a professional valuer, or a property purchaser at an auction or private sale. This is because an appraisal from a real estate agent is an estimate of how much your house could sell for; a valuation is a professional assessment of whether your home’s value is enough to secure a mortgage; and a sale price is how much a buyer thinks your house is worth on the current market. 

What is a valuation?

A property valuation is a formal assessment of how much your home is worth, to determine the Loan to Value Ratio (LVR) when you’re applying for a mortgage.

A valuation is carried out by a certified practicing valuer on behalf of a bank or mortgage lender, and is often based on available data about the property and recent sales of other similar properties in the local area. The valuer may also visit the property to assess its condition in person.

A valuation is typically different to an appraisal from a real estate agent, which is an informal estimate of how much a property could sell for at auction or via private sale.

What is an appraisal?

An appraisal is the process by which a qualified real estate agent conducts an inspection and assessment of a property in order to make an educated estimate of its value, typically in preparation of it being listed for sale. It is not to be confused with a valuation, which is conducted by a Certified Practising Valuer on behalf of a mortgage lender to determine the Loan to Value Ratio in relation to the borrow amount.

To begin the appraisal, the agent will start by visiting the property and assessing features such as the size, layout, number of bedrooms and bathrooms, quality of fixtures and fittings, and how well it has been maintained.

Next, the agent will use the findings to compare the property the with other similar properties in the area that have recently sold. In doing so, they are able to determine a more accurate appraisal that is representative of the current market demand.

What is a valuation and valuation fee?

A valuation is an assessment of what your home is worth, calculated by a professional valuer. A valuation report is typically required whenever a property is bought, sold or refinanced. The valuation fee is paid to cover the cost of preparing a valuation report.

When do mortgage payments start after settlement?

Generally speaking, your first mortgage payment falls due one month after the settlement date. However, this may vary based on your mortgage terms. You can check the exact date by contacting your lender.

Usually your settlement agent will meet the seller’s representatives to exchange documents at an agreed place and time. The balance purchase price is paid to the seller. The lender will register a mortgage against your title and give you the funds to purchase the new home.

Once the settlement process is complete, the lender allows you to draw down the loan. The loan amount is debited from your loan account. As soon as the settlement paperwork is sorted, you can collect the keys to your new home and work your way through the moving-in checklist.

Cash or mortgage – which is more suitable to buy an investment property?

Deciding whether to buy an investment property with cash or a mortgage is a matter or personal choice and will often depend on your financial situation. Using cash may seem logical if you have the money in reserve and it can allow you to later use the equity in your home. However, there may be other factors to think about, such as whether there are other debts to pay down and whether it will tie up all of your spare cash. Again, it’s a personal choice and may be worth seeking personal advice.

A mortgage is a popular option for people who don’t have enough cash in the bank to pay for an investment property. Sometimes when you take out a mortgage you can offset your loan interest against the rental income you may earn. The rental income can also help to pay down the loan.

Why does Westpac charge an early termination fee for home loans?

The Westpac home loan early termination fee or break cost is applicable if you have a fixed rate home loan and repay part of or the whole outstanding amount before the fixed period ends. If you’re switching between products before the fixed period ends, you’ll pay a switching break cost and an administrative fee. 

The Westpac home loan early termination fee may not apply if you repay an amount below the prepayment threshold. The prepayment threshold is the amount Westpac allows you to repay during the fixed period outside your regular repayments.

Westpac charges this fee because when you take out a home loan, the bank borrows the funds with wholesale rates available to banks and lenders. Westpac will then work out your interest rate based on you making regular repayments for a fixed period. If you repay before this period ends, the lender may incur a loss if there is any change in the wholesale rate of interest.

What are the features of home loans for expats from Westpac?

If you’re an Australian citizen living and working abroad, you can borrow to buy a property in Australia. With a Westpac non-resident home loan, you can borrow up to 80 per cent of the property value to purchase a property whilst living overseas. The minimum loan amount for these loans is $25,000, with a maximum loan term of 30 years.

The interest rates and other fees for Westpac non-resident home loans are the same as regular home loans offered to borrowers living in Australia. You’ll have to submit proof of income, six-month bank statements, an employment letter, and your last two payslips. You may also be required to submit a copy of your passport and visa that shows you’re allowed to live and work abroad.

What is a secured home loan?

When the lender creates a mortgage on your property, they’re offering you a secured home loan. It means you’re offering the property as security to the lender who holds this security against the risk of default or any delays in home loan repayments. Suppose you’re unable to repay the loan. In this case, the lender can take ownership of your property and sell it to recover any outstanding funds you owe. The lender retains this hold over your property until you repay the entire loan amount.

If you take out a secured home loan, you may be charged a lower interest rate. The amount you can borrow depends on the property’s value and the deposit you can pay upfront. Generally, lenders allow you to borrow between 80 per cent and 90 per cent of the property value as the loan. Often, you’ll need Lenders Mortgage Insurance (LMI) if the deposit is less than 20 per cent of the property value. Lenders will also do a property valuation to ensure you’re borrowing enough to cover the purchase. 

What is appreciation or depreciation of property?

The increase or decrease in the value of a property due to factors including inflation, demand and political stability.

What is equity and home equity?

The percentage of a property effectively ‘owned’ by the borrower, equity is calculated by subtracting the amount currently owing on a mortgage from the property’s current value. As you pay back your mortgage’s principal, your home equity increases. Equity can be affected by changes in market value or improvements to your property.