The role of valuations in building financial literacy

Publisher:
Pacific Rim Real Estate Society
Publication Type:
Conference Proceeding
Citation:
22ND ANNUAL PACIFIC-RIM REAL ESTATE SOCIETY CONFERENCE, 2016, pp. 1 - 12 (12)
Issue Date:
2016-01-19
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Problem/Purpose Residential property investment has become an asset of choice following the Global Financial Crisis as part of Australians superannuation. With investor participation increasing in determining how money is invested for retirement, the quality of advice and the role of that advice in determining the price paid for residential investment property through the use of valuation advice, is the focus of this paper. Design/methodology/approach In undertaking this study the opinions of several professions involved in the property purchase and investment process have been gauged through the use of surveys and semi-structured interviews with the results of the surveys analysed using SPSS. Findings The paper finds that direct residential property investment has increased as an asset in the investment portfolios of retirees and that a valuation undertaken by investors prior to purchase is an important step in building financial literacy. Further, it defines the importance of a regulatory framework which governs the investment advice process of which valuation advice forms part of the essential advice among investors taking residential property into retirement. Originality/value The emerging trend following the Global Financial Crisis is that more Australians are including residential property within investment as a retirement asset in taking greater control of their financial destiny. It further highlights that valuations are increasingly being commissioned prior to purchase and provides key information in the property purchase process.
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