3 Reasons why - Valuations

Difference Between Online Estimates, Bank Valuations, and Real Estate Appraisals

Understanding the distinctions between online estimates, bank valuations, and real estate appraisals is essential for property owners, buyers, and investors, as each type serves a different purpose and employs various methodologies.

Online estimates provide a quick and often automated assessment of property value based on available data such as recent sales and market trends. These estimates can vary significantly and don't take into consideration special features, upgrades or the actual condition of a property.

Bank valuations are carried out to support lending decisions and manage risk. They are are produced either online through tools like I-Val or E-Val, or in person by a Registered Valuer. These valuations rely heavily on market statistics and recent sales data. However, because sale prices are only made public once a property has settled, often weeks or even months after going unconditional, there is usually a delay in the information available to valuers when assessing a property.

Real estate appraisals are carried out by licenced Real Estate Salespeople to determine market value of your property using up to date market data. This process involves a comparative market analysis, that looks at a property's condition, specifications, location, local amenities, comparable sales data and current market movement in the area.

In summary, while all three types of valuations aim to assess property value, their differing purposes and methodologies highlight the importance of understanding these distinctions for informed decision-making in property transactions and investments.