Real Estate Market Appraisals – Are they Science, Fact or Fiction?

Why do real estate market appraisals vary so widely between different agents ?

Science Fiction House

In this day and age of technology all real estate agents and the general public have access to huge volumes of statistical data on real estate.

Why then, are some market appraisals on the same property from different agents so far apart in their estimated selling price?

The answer lies largely in the way that the particular agent or agency seeks to influence the seller to list their property with them.

When listing property the agent’s opinion is interesting, the owner’s opinion even more interesting, however it is the person with the cheque book, the buyer, who will ultimately determine the price.

Once all the statistical market analysis is done using online software such as Core Logic RP Data or Pricefinder, it comes down to where the agents “opinion” of estimated selling price falls.

Some agents will “high ball” the price, placing an unrealistic value on the property, appealing to the owner’s sense of emotion to convince them that their property is worth more than it actually is, in order to secure the listing.

This is commonly known as “buying the listing”!

Other agents will “low ball” the price most often with the attraction of low budget rate commissions.

The pull of the hugely discounted commission can be so appealing that the seller can lose sight of the main objective in the sale of their home, and that is to achieve the best price possible.

The budget discount agent will often also boast that they “Sold the Property in 2 Days”.

These style of agents will attract bargain hunter buyers who know that the properties listed by this agent are below market value and “snap them up” as soon as they are listed.

If your property sold in 2 days, you may well have missed the buyer who would have paid significantly more, BUT did not know your property was available.

If you choose an agent who promotes their service on how CHEAPLY they can sell your house, be aware your outcome may be similar.

It would be reasonable to form the supposition that these agents are acting more as a pseudo buyer’s agent that an agent for the seller.

If you want to catch a fish, throw in a line. If you want to catch them all you will need a net.

The net needs to be spread as wide as possible to capture the interest of every potential buyer who may be interested in your property.

At Regional and Rural Realty we use well researched leading edge marketing to capture the widest possible interest in your property and take the time to negotiate the very best price possible for your property.

We have all had trades quotes for work we require around our property. Some quotes are high and some low, general rule of thumb is to get 3 quotes and accept something in the middle.

As with trades people offering free quotes as par for the course, Real Estate Agents also offer free appraisals as a standard service.

Don’t be fooled into thinking you are being offered something for nothing, or feeling a sense of obligation to sign up if you are not totally comfortable.

Ultimately, you need an agent who will work hard for you, the vendor, to negotiate the Best Price and not the fastest 2 day discount commission, on a shoestring budget.

Choose an agent that you can trust will work in your best interests and not that of the buyer or themselves.

Drew Oliver

Regional & Rural Realty