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  1. #1

    Question Question about chattels valuation

    Hi Everyone, I'm a newbie and building my first investment property in chch. Now I'm looking to get a chattels valuation report and got some questions. Hope someone here can help me?

    - Who do you recommend for getting this valuation?

    - How should I know if I get the best values for each item or in overal? Should I ask them for a preliminary valuation first when I approach them?

    Thank you in advance.
    Alpine

  2. #2
    Join Date
    Oct 2013
    Posts
    1,613

    Default

    Hi Alpine, welcome to the forum.

    Call Valuit. They're the only chattels valuers I'll recommend. Any reports I've got from others have had mistakes or difficult to understand.

    You won't know if you get the best values. Just accept what Valuit give you unless something looks totally bizarre.
    AAT Accounting Services - Property Specialist Accounting - AATAccounting.co.nz
    Lower fees for investors, traders & real estate agents!
    [email protected] for more information.

  3. #3

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    Thank you so much Anthony. Is there any standard in the industry they follow to value items? or it is just their personal opinion?

  4. #4
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,592

    Default

    Quote Originally Posted by alpine View Post
    Hi Everyone, I'm a newbie and building my first investment property in chch. Now I'm looking to get a chattels valuation report and got some questions. Hope someone here can help me?

    - Who do you recommend for getting this valuation?

    - How should I know if I get the best values for each item or in overal? Should I ask them for a preliminary valuation first when I approach them?

    Thank you in advance.
    Alpine
    Hi Alpine,

    Why I recommend a chattels valuation for a new build? There is no longer any building depreciation, so if you don't depreciate chattels you will get no tax deductions for any wear and tear of your chattels. Whereas if you depreciate the chattels, you will get a deduction for depreciation on items like carpet, curtains, dishwasher, stove, heat pumps, fences, driveways etc. For a new build there is likely to be over $30,000 in chattels, so in the long term you will gain a deduction for $30,000 (over 10 or more years) of your profit and if taxed at 33% save $10,000 in tax. A chattels valuation normally costs between $400 and $500 as a one off cost, so is a pretty good return on your investment!

    The correct way of valuing chattels is the cost. So if you have the cost of each item, that is the value you should use. Often investors will use www.valuit.co.nz as it is a lot easier to spend the $400 to $500 getting the valuation then it is to obtain the cost of each item. Also a lot of investors don't know what are chattels and what isn't, so the valuation makes life easy.

    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  5. #5

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    Hi Ross,

    Many thanks for your reply and all explanation. I actually asked "who do you recommend" and not "why do you recommend" though you already gave me the answer and thanks for that. Do you also think I just need to book an appointment with them and accept whatever the result is (except if something's bizzare)? I also expected the value of chattels should be about $30K but when I ask one valuer to give me a preliminary valuation he said he expects something about $20K. I really don't know how to justify this? or just accept it?

    Thanks, Alpine

  6. #6

    Default

    I learned on my last project to include the install cost of the item too. Usually that will be the cost, so $3k for a heat pump includes the labour of the installation, but it's good to get that lost from your builder and if you do a valuation you can compare.

  7. #7
    Join Date
    May 2007
    Location
    Hamilton
    Posts
    3,592

    Default

    Yes, definitely includes cost to install.

    When I review or see financial statements for new clients, its amazing how many don't depreciate chattels. In my opinion it is the number 1 item missed and overall property investors are missing thousands and thousands in deductions by not doing chattels depreciation.

    Often I will hear, "but we don't want to recover the depreciation later". This is a load of rubbish, as chattels do decrease in value and there often is no recovery when the investment property is sold. Or very little recovery in the odd case there is recovery.

    Commercial building - can depreciate internal walls, plumbing, electrical. It can even be better and more worthwhile!

    Ross
    More Profit from Property? TEACH ME MORE
    Ross Barnett - Coombe Smith Property Accountants
    Proud to give the best property advice for over 13 years.

  8. #8

    Default

    Thanks Nick. Do you mean if builder say heat pump cost is $3K and valuation comes out with $2K then I can use builder's report instead of valuation?

  9. #9

    Default

    Quote Originally Posted by Anthonyacat View Post
    Hi Alpine, welcome to the forum.

    Call Valuit. They're the only chattels valuers I'll recommend. Any reports I've got from others have had mistakes or difficult to understand.

    You won't know if you get the best values. Just accept what Valuit give you unless something looks totally bizarre.
    Thank you Anthony for your advice.

  10. #10
    Join Date
    Jun 2004
    Posts
    10,364

    Default

    Quote Originally Posted by alpine View Post
    Thanks Nick. Do you mean if builder say heat pump cost is $3K and valuation comes out with $2K then I can use builder's report instead of valuation?
    If it is a new place use the cost (get the builder to tell you).
    If not new then what would the builder know about what it is worth NOW - he's not a valuer? He could tell you the replacement value but that isn't the one you are looking for.

    Regardig arguing with the valuer - you are employing a professional to do a job then want to tell them their job?


 

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