What’s the difference between a property appraisal and valuation?
If you’re thinking of selling your Northern Districts home, you’ll want some idea of its value. This will allow you to plan ahead and ensure all your numbers add up before you expend time and energy on a sale.
Your first step is to get your property valued. But who is best placed to do this, and what’s the difference between a market appraisal and a valuation?
What is a market appraisal?
Simply put, real estate agents offer appraisals. They are free of charge and are a great starting point when considering a home sale. An agent will base their appraisal on a number of factors including:
Recent sales prices in the area: Agents have access to the selling prices of homes throughout their area and beyond. A good agent will share this information with you to show what comparable homes have gone for in your suburb. They will also tell you when the sale took place. This gives you a better overview than listings on property websites, which don’t reflect actual sales prices.
Where your property sits in the market: An agent will have a good idea of what your property is worth based on demand in the area. They will consider features such the location, the number of bedrooms and bathrooms, and its local school catchment. Other factors such as the condition of the property, the block size and whether it’s renovated or not will also come into play.
General property trends in the area: By looking at how long properties are taking to sell locally, auction clearance rates and wider market trends, your agent will be able to provide you with a price guide. They will also advise on how to price your property for a quick sale, if that’s what you want.
A point worth noting: Property appraisals are free, so some sellers will obtain them from a few different agents. However, estimates may vary wildly. This is because unfortunately some agents will name an unrealistically high price to win your business.
Look for an agent who knows the area and who comes recommended. Remember, selling a home can be a lengthy process. For this reason you want someone who has a reputation for providing great service throughout an entire sale.
What is a valuation?
A valuation is a legally binding report, written by a trained independent valuer. It is generally based on past sales and may be carried out by a bank when lending money for a mortgage. For this reason, a valuation tends to be more conservative than a market appraisal. Some buyers will also organise a valuation to ensure they aren’t over-stretching themselves financially.
While valuations tend not to vary too much, the sales price can often come as a surprise. A valuation is set by previous sales and the property itself, so there is some degree of consistency. A sales price has the human factor added. So if a buyer falls in love with a property and is competing with others who feel the same, they may pay a higher price to secure it.
Online valuations
These are based on previous sales prices and the property’s features and location. They are a useful guide price, but are best seen as a price indication. This is because an online valuation tool can’t physically inspect the property. This means it misses unique features such as architectural merit.
Talk to me
As a local agent specialising in Thornleigh and the Northern Districts, I am always happy to talk to you about your property. For me, an appraisal is a helpful, no-obligation opportunity to meet with you and get an idea of what you are hoping to achieve with a property sale.
A property appraisal also gives you a chance to ask questions and understand how your home stands to fare in the current market. I am always happy to talk to people thinking of selling and looking for some pressure-free advice. Please give me a call today!
