Ask three sources what your home is worth and you may get three different answers: an agent, an online tool and a valuer. They are not interchangeable. Each is prepared differently, by different people, for different purposes, and each can be relied on for different things. Choosing the wrong one can cost you time and sometimes money.
1. Automated Estimates
Online value tools produce a number from a statistical model using public data such as past sales, property features and local trends. As the Australian Property Institute (API) describes it, nobody inspects the property and no valuer stands behind the figure. These estimates are free and instant, which makes them useful for curiosity or a rough starting point, but they cannot account for condition, renovations, unapproved work or anything not captured in the data.
2. Agent Appraisals
An agent's appraisal is an opinion of what a property might sell for. The API's guide to levels of valuation advice describes it as a marketing opinion, often prepared to win a listing or set an asking price. The agent has no obligation to be independent or to follow valuation standards. That does not make agents wrong, since they know their local market well, but their appraisal is not something you can rely on for tax, legal or financial decisions.
3. Formal Valuations
A formal valuation is prepared by a qualified valuer. The API says its Certified Practising Valuers must complete an API-accredited degree, then at least two years of on-the-job training, plus coursework in ethics and risk management. The valuer inspects the property, applies recognised methods, relies on verified comparable evidence and records their reasoning in a report. Because they have no stake in whether you sell, the opinion is independent, and the report can be relied upon by lenders, accountants, courts and tax authorities.
Registration rules for valuers differ by state. In Queensland, for example, a person must be registered with the Valuers Registration Board of Queensland to work as a valuer. Check what applies in your state, and ask any valuer about their qualifications and membership.
Levels of Valuation
Not all valuations are equally detailed. Lender-facing guidance from Macquarie, for example, distinguishes desktop valuations, short-form valuations and long-form valuations, with different turnaround times (see our guide to how long a valuation takes). The ATO's guidance also notes that, for tax purposes, how a valuation was done matters more than who did it, and that records of the method and evidence should be kept.
Side-by-Side Comparison
- Automated estimate. Produced by a model, no inspection, no accountability. Suitable for a rough idea only.
- Agent appraisal. A marketing opinion, usually free, from someone who may want the listing. Suitable for sale planning.
- Formal valuation. Independent, inspected, documented and accountable. Suitable for finance, tax, family law, estates and disputes.
Which One You Need
Ask who will receive the number and what they will do with it:
- Just curious or thinking of selling in future? An online estimate and an agent appraisal are reasonable starting points.
- Applying for or refinancing a loan? The lender usually arranges its own valuation, but you may want an independent view.
- Tax, such as capital gains? You need a formal valuation that meets the ATO's expectations for evidence and independence. See our CGT guide.
- Separation, estates or disputes? A formal valuation, often from a jointly appointed expert, is the norm.
- Insurance or planning? A formal valuation gives a defensible figure for cover levels or portfolio decisions.
Our guide on when to get a property valuation goes into more detail, and you can contact our team if you are unsure which fits your situation.
