Property valuations need to incorporate a greater degree of balance so mortgagors and mortgagees can both receive a fair assessment and property funds can reflect a truer value, according to Australian Unity Investments head of property Martin Hession.
"We've got people coming in and going out of funds on a daily basis and they want to do that at a price which is fair value and they're not interested in other peoples' problems," Hession said.
Current property valuations are giving too much weight to the distressed selling happening in the market, meaning valuations are not as accurate as they could be, he said.
"The people that are coming out of these funds are not distressed. They might see that airfares are cheap overseas and they might go for a holiday and cash in some of their investments," Hession said.
"So they're not cashing them in because they're distressed, the fund is not distressed - no one is distressed. So why are you pricing these things as if they are distressed when they are not?" he said.
In particular, valuers needed to be mindful of both mortgagors as well as mortgagees when making their assessments.
"This is not a one-sided game. It's not just to benefit mortgagees. What about the dis-benefit to investors?" Hession said.
"So we need to get some equality, some fairness, and some balance between the two parties here. One is not superior to the other although it might appear they are."
