What to do if you don’t agree with an agent’s appraisal of your home

Your home is your castle. To you, it’s probably priceless. But if you’re considering putting your home on the market, you will need to decide on a fair price based on the current market value.

Determining what your home is worth based on current market values is both a science and an art.

It’s common for vendors to have an unrealistic expectation of the value of their home and want to list it for more than it’s really worth. Alternatively, some may want to list their home for less than they think it’s worth in the hope of sparking a bidding war among interested buyers.

It’s worth seeking the opinion of a local real estate agent who can give you an appraisal and a guide to the price they believe your property would fetch on the market.

They will take into consideration:

• recent property sales and listings in your area
• the size of the block of land
• the size of the home
• the condition of the home
• the aspect of the home and layout of the property
• proximity to local amenities
• planning restrictions and zoning
• unique features, such as pools, outbuildings, electric gates and gardens

“Your agent should be the expert on a realistic asking price for your home and should be providing you with the sales data and knowledge. They really should be across every sale in your local area in recent years,” buyers agent Michelle May says.

“Estate agents look closely at what other agents are pricing homes in the local area, and can help guide you through the process of pricing your home for sale.”

But what should you do if you disagree with the agent’s appraisal? If you believe the recommended listing price is above or below what you think your home is worth, there are steps you can take.

Start by doing your own research. Online estimators, such as this one from Domain, take into account recent sales in the area, land size and features of the property and give you a price range for your home.

Like appraisals, online estimators should be used as a guideline only, though they can be handy when weighing up a listing price for your home.

Be cautious when comparing your property to nearby homes listed for sale. These properties haven’t sold yet, meaning there’s no evidence that they will sell for the asking price.

“Compare recent property sales in your local area, and get along to a few open homes if you can. Also, be sure to seek an appraisal from at least three agents to see how their valuations compare,” May says.

The Office of Fair Trading states that you could have up to a 10 per cent range in the price guide listed for a property. “Having an open dialogue about how they [the agents] have decided on the price for your home will help you understand the process they have taken,” she says.

“If you still don’t agree with the price and there doesn’t seem to be much room for negotiation, they may not be the best agent to work with.

“If you don’t agree with the suggested listing price, don’t sign a sales agreement, and instead look for another agent. Vendors should always interview at least three selling agents and do their own research to really understand what they believe the property is worth,” May says.

A good real estate agent should come armed with a strategy to sell your home. Be sure to look at how many listings they have, their previous sales, how they market properties, and the costs involved in advertising your property for sale.

Ask about their local knowledge of your suburb. Also, look at their metrics, such as average days on the market, auction clearance rates and how many days a week they work – which points to their availability should a potential buyer come knocking, May adds.

Agents are not meant to mislead consumers to encourage high offers. If you feel that a real estate agent has misled you about a property’s price, you should contact the Australian Competition and Consumer Commission.