If you look up appraisal and valuation in the dictionary, they will come up as synonyms, but there is a huge difference between those words when it comes to real estate.

Realtors often offer people “free appraisals” of their property but as good as it sounds, those appraisals are inaccurate (to say the least). What the estate agents are really doing is applying their knowledge of local market to try and predict what that property can be sold for. Why they call it appraisal? Because they are not professional valuers and it’s illegal for them to use the word “valuation”.

Why shouldn’t people believe those appraisals, after all who knows the prices better than the local real-estate agent? Because in many cases estate agents have their own agenda in mind – so they can give a higher appraisal to attract people so that they choose to sell the property through their agency, etc.

I liked the way Lawersrealestate.com.au explain all about the difference between those “appraisals” and professional valuation, have a look on this page.

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