The methodology adopted by valuers is in accordance with the Australian Property Institute’s direct comparison method.
This method involves the review and comparison of ‘like properties’ in the surrounding suburbs and vicinity which have recently been confirmed as leased by local real estate agents. The ideal comparison pool of properties will involve a mix that include ‘superior’, ‘comparable’, and ‘inferior’ attributes (these labels are consistent with terminology used by the valuers).
Based on market requirements, the valuer then determines the position of your property next to the comparison properties by reviewing attributes and appeal of the property. Once the order is determined, rents are applied in a range at which the property rent can be based.
A common misconception is that the average values of the comparable properties will equate to the rental value of your property.
The properties listed on your rental certificate are provided as indicators and do not constitute the total market assessment or the total evidence base used to determine rent. The direct comparison method does not include averages or medians, as these are area-based and do not specifically reflect the property being valued.