Understanding Appraisals

understanding an appraisal

Understanding Appraisals! The first thing you will want to know about your property when selling is how much it is worth. But what is in an appraisal and what information do they include?

The appraisal an Agent does for you will give you an idea on what properties have physically sold for. This is fact, it can’t be changed and is the best data to go off, providing they are comparing apples with apples. The appraisal should include: 

  • Recently Sold Data When reviewing their appraisal and the sold properties, is the age of the property a similar era, size of land, number of bed and baths the same? If not, ask them why! Have they chosen properties in a higher price bracket that don’t really compare because they want to give you a property value that is higher to get your business, hoping that you don’t understand the data they are presenting. Or, is it because there are genuinely no comparable properties in the market and they are trying to find the closest.This is where you might need to do some of your own research to know what has sold lately in your area. Generally speaking, they should be assessing sold properties in the last 3-6 months, so they are looking at properties in the same or similar market conditions. If there aren’t many comparable listings, they may go back 12 or even 18 months, depending on the product you are selling. For example, a 50-acre site that is regional might not have much to compare to, or the area you are in is an area where people hold onto properties and sales are few and far between.
  • On Market Comparisons Next, an Agent will look at what is currently on the market and what prices that style of property is being listed for, using the same method, comparing apples with apples.
  • Demographics Some Agents will also include data about the suburb, the demographics, recent market trends and long-term market trends. The market trends will indicate in which direction the property market is heading for that area. They will also indicate the average days on market i.e. how long properties are taking to sell.
  • Recommended Price Range The Agent should also give you their recommended price range of what they think the property is worth. This range when used for advertising, legally cannot be greater than 10%.
  • Accountability By getting 3-4 appraisals, it holds the Agents accountable, it also creates a competition and will separate the champions from the meek. Experienced Agents will not only know, but also expect you to be researching with others. They won’t be offended, as it is part and parcel of the course.
  • Additional Benefits The competition is created when they start working harder for your property and to secure your listing, this shows they are genuinely keen on your property. Some may offer sweeteners, like reducing advertising costs, reducing commissions, or guaranteeing to be at every open themselves and do all the communicating, rather than offloading it to a Junior Agent or P.A.


Need to clarify the data in your appraisal? This is where a Vendor Advocate can really help, They are experienced in translating and challenging the data! Talk to our Agent Select Team today or Download the compete guide: 7 Steps to taking the stress out of selling