When you’re thinking about selling your home, one of the first steps is getting a property appraisal. It can feel straightforward—an agent tells you what your home might sell for— you like the estimated sale price and agree to list with them. But beware, there is a lot more to consider before you sign on the dotted line.
In this month’s blog, we take a look at what is legally required from a Real Estate Agency when completing an appraisal and what to look for. Understanding the different parts of an appraisal can make a significant difference to your expectations of the amount your property will sell for, the costs involved and your overall experience.
First – What an appraisal is (and isn’t)
A property appraisal is a market-based estimate of what your property could sell for in current conditions. It is also known as a Comparative Market Analysis (CMA) and is not a formal valuation, and it shouldn’t be treated as one. It is also likely to differ from the estimates you see on various property advertisers and even some Real Estate companies that offer an immediate value on their website. This is because the estimates do not take into account the current condition or unique features of your home and is a ball park figure based on recent sales in your suburb (which can differ from street to street within that suburb), and may be several months out of date if sales in your area have been slow, or if the sale prices have not been made public yet.
As licensed Real Estate salespeople, we are bound by the Real Estate Agents Act 2008 to ensure that appraisals reflect current market conditions and be supported by comparable sales, but they are still an informed opinion rather than a guaranteed price. You can read more about the rules we abide by with regards to appraisals on the Real Estate Authority (REA) website here.
Should you seek more than one appraisal?
Even though you might be chomping at the bit to have your property listed and sold, it can pay to take the time to get more than one appraisal. This is because different agencies may:
- Interpret the market differently
- Use different comparable sales
- Recommend different sale strategies
The appraisal is also your opportunity to get to know the salesperson better, ask questions about their background, experience, passion for real estate and generally work out if they are someone with whom you can work.
It provides you with a realistic price rand and insight into the different selling approaches available to you.
What to pay close attention to
Whilst it is tempting to just go by the expected sale price, it is vital that you also pay attention to:
1. Comparable Sales
A good appraisal should clearly explain:
- Which properties were used for comparison
- Why they are relevant
- How your home differs from others.
If there’s limited comparable data, the agent should explain this in writing and if you only see a list of sales with no explanation, ask why.
2. The Price Range
Be cautious of:
- Very high appraisals designed to “win” your listing*
- Very broad price ranges with little justification
There have been cases where the salesperson has inflated the appraisal price to “win” the listing, only to recommend the vendors reduce the price after a few weeks on the market, due to “market pressure”. The REA expects appraisals to be realistic and aligned with the market, not inflated or misleading.
3. How the Appraisal Was Prepared
An appraisal should involve:
- A physical inspection of your property
- Consideration of condition, upgrades, and location
All should be mentioned in the appraisal summary as an explanation as to why your property has been priced higher/lower. A legal appraisal cannot rely solely on online estimates or automated tools.
4. The recommended method of sale
There are a number of ways to sell your property and some work better than others depending on your location and reason for selling. Your appraisal should include a discussion about:
- Auctions
- Deadline sales
- Negotiations
- Fixed price, or offers over
All real estate salespeople are legally required to explain the options and how each method works. It is up to you to decide with their guidance, but they cannot make the decision for you.
Understanding the costs involved
This is where many vendors get caught out and end up spending more than what they thought they would. The salesperson must clearly state the costs and involved and before asking you to sign, they should ensure you clearly understand what is and is not included and how much it will cost. The listing agreement must include details of the following:
Commission
- Usually, a percentage of the final sale price or a stepped percentage. It is a legal requirement to disclose it in writing with an explanation/example of how it is calculated. They must also let you know when commission will be charged (some require once the sale goes unconditional whilst others do not take payment until settlement).
Marketing Costs
- Photography, advertising, online listings
- What’s included vs what’s extra
Note: if marketing is “free” the listing agreement should still include what the Agency will be doing to marker your property and what it is offering for free. Some Agencies require marketing costs to be paid once a listing goes live
Other Potential Costs
- Auctioneer fees
- Premium marketing upgrades
- Administrative or listing fees
If it is a no sale, no fee situation the Agency is legally required to disclose in the agency agreement that commission is only payable upon a successful sale. They must outline the exact terms for payment, how marketing expenses are handled, and provide a written list of prospective buyers if the agency agreement is terminated to avoid double commission claims.
Some agencies (including us) require marketing costs to be paid once a listing goes “live” whilst others charge once settlement is complete. Most (including us) offer payment plans if the marketing fees are billed before settlement.
Why comparing appraisals really matters
We cannot stress enough that when comparing multiple appraisals, don’t just look at the price.
Look at:
- The evidence behind the price
- The strategy to achieve it
- The costs involved
- The agent’s communication and transparency
The best agent isn’t necessarily the one with the highest estimate—it’s the one who can justify it and deliver on it.
Get a clear, honest appraisal with no obligation
If you’re thinking about selling or just want to understand where your property sitsin today’s market, we are here to help.
At Tim Baker Real Estate, we offer appraisals that provide clear, practical advice with no pressure to list. Your property, your decision, information you can trust.
We’ll walk you through:
- Your property’s likely price range
- The best method of sale for your situation
- All costs upfront—so there are no surprises
And, because of our size, we are able to offer a low commission rate. Helping you keep more of your sale price while still receiving the high standard of service you deserve.
Give us a call today for a no-stress chat about your situation and arrange an appraisal at a time that suits you.
Tim Baker Real Estate- celebrating 30 years of selling in Christchurch in April 2026.
