What your property is worth

A useful price conversation starts with evidence, before anyone names a figure. Build your own price range from settled sales before an agent walks through the door, and every appraisal you hear becomes something you can test rather than something you have to take on trust. That range underpins the rest of the sale: the method, the launch price, the reserve and the offers you accept all lean on it.

Appraisal, valuation, estimate: not the same thing

An agent appraisal is a free market opinion from someone who wants your listing. It’s usually informed by genuine local knowledge, but it is also part of the agent’s pitch for your listing, not a neutral assessment. It carries no legal weight.

A bank valuation is a formal assessment by an independent certified valuer, ordered by a lender to protect the lender. Valuers are deliberately conservative because their job is to estimate what the bank would recover in a forced sale. Bank valuations commonly land 5 to 10 per cent below what a well-run sale achieves. If a buyer’s bank valuation comes in low, their loan can shrink, which is why “subject to finance” offers sometimes fall over even when the buyer is keen.

Online estimates (the automated numbers on the major portals and bank apps) are statistical models fed by past sales data. For a standard house in a suburb with plenty of recent sales, they can be within a few per cent. For renovated, unusual, rural or recently quiet markets, they can miss by 10 to 20 per cent in either direction. Most platforms publish a confidence band with the number. Read it. A “$910,000 estimate” with a band of $780,000 to $1,040,000 is telling you, politely, that it doesn’t know.

The order of reliability for an owner-occupier sale, from least to most useful: online estimate, bank valuation, a well-evidenced agent appraisal, and finally the only number that actually matters, which is what a buyer signs for.

How agents actually build a price

A competent agent prices your home with a comparative market analysis: recent sold prices (not asking prices) for genuinely comparable properties, ideally within about a kilometre and the last three to six months, adjusted for land size, condition, parking, aspect and street. They’ll weigh current competition (what a buyer with your budget can buy instead this weekend) and buyer depth at your price point.

Ask every appraising agent to show you the comparables behind their number. The quality of that evidence is the single best test of the appraisal, and of the work they’d do on your sale. Three settled sales of similar homes within a kilometre tell you more than any amount of confidence at your kitchen table.

The two traps: underquoting and overquoting

Underquoting is advertising or quoting a price below the agent’s genuine estimate to pull a bigger crowd, then letting competition push the price up. It mostly hurts buyers, but it can hurt you too: a campaign anchored too low can stall at the anchor if competition doesn’t materialise. NSW and Victoria both have specific underquoting laws. In NSW, the advertised price can’t be below the agent’s written estimate in your agency agreement. In Victoria, agents must publish a Statement of Information with an indicative selling price supported by three comparable sales. If an agent’s quoting strategy makes you uncomfortable, that discomfort is data. Our guide to underquoting laws by state has the detail.

Overquoting runs the other way, and it affects sellers directly. An agent can “buy the listing” by appraising high, knowing sellers are drawn to the biggest number. What often follows is conditioning: weeks of relayed “buyer feedback” that the market thinks the home is overpriced, until you agree to a reduction to the figure the agent expected all along. By then you’ve lost four weeks, your listing has gone stale, and the agent is still paid commission. Conditioning is the most common and least discussed cost of choosing an agent on appraisal price alone.

Sanity-check the number yourself

Before any agent walks through your door, spend an evening building your own view:

1. Pull every settled sale of a comparable property (same suburb, similar beds, baths, parking and land) from the past six months. Portal “sold” filters and state government sales data both work.
2. Throw out the outliers: the un-renovated deceased estate, the architect rebuild, the main-road block.
3. Adjust the survivors roughly for condition and land. Renovated kitchen and bathrooms might be worth 3 to 7 per cent in most suburbs; a busy road can cost 5 to 10.
4. Note the original asking price against the final sale price for each. That gap is your suburb’s reality check.
5. Land on a range, not a number. If your range is $820,000 to $870,000 and an agent says $950,000, ask them to show their working.

You will not be as accurate as a good local agent. You don’t need to be. You need to be accurate enough to tell a well-supported figure from a flattering one. Then Chapter 3 turns the price into what you’ll actually walk away with.