If you’re concerned about getting impartial advice, you should consider getting valuations from 2 or 3 local agents.
Which Real Estate Agent has assisted over 14,000 homeowners connect with top performing agents in their area. We can provide you with the information you need to confidently choose the best real estate agent. Speak with one of our local consultants now.
Property Value is CoreLogic’s (formerly RP Data) publicly available property price estimation tool. It also has subscription price estimate tools, which we did not analyse. The publicly available estimate looks like:
Price range and level of confidence
Users urged to upgrade ($49 for one week access) to view exact estimated value and other insights such as estimated rent, pros and cons of property and investment strategy scores
Comparable properties for sale, recently sold and for rent – must upgrade to see more
Market trends, auction results and demographic information also provided.
After entering in an address, the user is prompted with a series of screens asking for more information about the property (beds, baths, condition, etc.) and their contact details.
What does it do?
The user receives an email explaining that a real estate agent has been provided with their details and will be in touch to provide an estimate. The email links to a page that includes comparable sales sourced from realestate.com.au and RP Data (now CoreLogic).
An introduction to a local agent
Local area data like demographics, average income and interest rate history
Homeowners can appoint a licensed valuer to appraise their property after a physical inspection. They base their property valuations on a detailed assessment of the property and recent market sales.
And don’t forget:
They are legally responsible for the information they provide.
Real estate agents
Real estate agents provide price estimates after they have inspected the property and evaluated recent sales in the area.
Because they actually see the property and have knowledge of similar properties in the area, they are able to make far more accurate estimates of your property’s value than online property valuation websites.
Which Real Estate Agent will help you find top real estate agents in your area so you can get the valuations you need.
Which website provides you with the most accurate property valuation?
We calculated estimates for 214 recently sold properties using all five property valuation websites.
We compared those estimates to actual sale prices.
Each property was sold between 6 and 12 November 2015.
As a reference:
All sale prices were displayed on realestate.com.au and properties were sourced from each Australian state and territory, mostly from capital cities.
In a nutshell:
They broadly reflected Australia’s population footprint.
This may surprise you!
Each property estimate website was reasonably accurate at assessing the portfolio of properties. Average variances between the estimate and the recent sale price ranged from 6% to 15%.
While realAs was the most accurate on average, we observed some discrepancies at an individual property level across all websites.
But, does it matter?
Unless you’re a big property investor, the average is all you really care about.
Here’s how the websites ranked, from most accurate to least accurate:
On The House
But wait – realAs has a completely different methodology to the other sites we examined (using information input from buyers) and we found that a lot of properties did not have estimated values.
We found that 13% to 25% of the 214 properties searched returned no data at all. They either had no estimate or no sale price.
What did we find?
53 results across all websites had variances greater than 30% of the sale price.
Domain and OTH were the worst offenders. They each had 19 properties with variances greater than 30% of the sale price.
Estimate accuracy to sold price
*See limitations section below
Given the number and size of some of the outliers, we re-ran the findings to see if the order of website accuracy changed when outliers greater than 50% of the sale price were excluded.
We got rid of 27 properties in total.
Here’s another interesting thing:
We found that while the average variances dropped, the accuracy ranking remained similar.
The adjusted average variances for each site are as follows:
For the majority of property owners, these websites give a broad indication of how much their home is worth today.
But remember this:
These are relatively new tools.
As they fine-tune their algorithms and expand their data sources, they will become more accurate.
realAs is one small step ahead of its competitors.
What sets it apart?
It sources price information from buyers, rather than relying on property features and recent market data like its competitors.
Their approach does lend itself to a huge problem though – only properties currently on the market can give estimates.
OTH appears to be the most comprehensive of the price estimate tools, returning estimates for 87% of all properties searched.
And one more thing:
While it had a median average variance of 4%, it also had big discrepancies as well: +466% and -89%.
Newcomer Domain, backed by its APM and PriceFinder smarts, had the lowest median variance, but also returned the most amount of outliers.
CoreLogic fared very well and gave us the second best estimations, while also presenting us with a large amount of available estimations for properties.
After all, CoreLogic is widely considered to have the largest data set, and its property price indices are industry-leading.
We recommend CoreLogic for sellers looking for preliminary information on their property. If you would like your own report from CoreLogic, just have a quick look at our page explaining how to get one.
Keep in mind:
These estimates were collected mid-November 2015, and may have changed since.
An overview of the facts to assist you
If you want to know what your home is worth, these websites aren’t a bad place to start. Visit a few and see what they come up with.
As realAs provides estimates for properties currently on the market, it may be of limited use to homeowners seeking an estimate before selling.
While a cursory check can’t hurt, we suggest you do not rely on them.
In all honesty:
If you’re seriously thinking about selling, we advise you to do your own research.
You might also want to seek the opinion of a licensed valuer, or request an appraisal from a couple of quality local agents. If you need help in this area, our agent comparison tool will identify those agents who are currently selling properties like yours, in your suburb.
Understand the limitations for more accurate valuations
As we compared price estimates to recent sales, you would expect the variances to be low, as they have current market data to benchmark their estimates. Therefore: this analysis assumes the best case scenario. We suspect that if we repeated the process with properties that hadn’t sold in the last three years or more, then the variances would be significantly greater. Interesting, right? In reality: we adopted our approach due to the availability of the sale price data and also to include realAs in the analysis, which focuses on providing estimates for properties recently and currently on the market.
The speed at which a website updates its price estimates would impact the variances observed. By the way: we calculated the estimate shortly after the property was sold.
At 214 properties the sample size is considerable. But: given there are millions of properties in Australia, it is relatively small and the conclusions drawn should not be relied upon.
If the property was for sale or sold, Domain and OTH noted this (54 and 27 times respectively) and no estimate was provided. This explains their lower number of properties with estimates. However: CoreLogic’s property value website provided an estimate, even if the property was for sale or recently sold. Realestate.com.au/property website (not shown in the analysis but listed below) only provides an estimate if the property isn’t for sale.
As you can see, property valuation sites tend to be inaccurate but can provide an idea of your property’s value and provide a valuable initial resource to homeowners when selling your home.
But, even in this modern age, a computer algorithm isn’t going to beat human knowledge. We recommend paying for a valuer to provide you with a formal valuation or finding top agents in your area and using their local experience to give you a free market appraisal.
A property valuation is a formal process performed by a professional to determine the price of your property and are considered accurate at determining the value of your property. An appraisal, however, is an estimation of your property’s value. They are normally informal and most likely performed by a real estate agent on first viewing of your property. Appraisals are intended to be a guide prior to a formal valuation.
The time it takes to value a property is dependant on the size and style of property. Smaller units or apartments may take 15 minutes, while larger properties several hours. It is common for valuers to not provide the number on the spot, rather they take the information home and compare it against other similar sales in your area to create a more accurate property valuation.