Valuation, appraisal, bank valuation, estimate.
A valuation is a formal opinion of market value at a stated date, prepared to a professional standard by a qualified valuer, setting out the comparable evidence and assumptions relied on and carrying professional liability. An appraisal is a real estate agent’s opinion of likely selling price, provided free and carrying no liability. A bank valuation is instructed by a lender for its own security assessment. An online estimate is a statistical model that has never seen the property. Courts, the ATO, state revenue offices and SMSF auditors accept the first and generally reject the other three.
The whole distinction, on one table.
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| INDEPENDENT VALUATION | AGENT APPRAISAL | BANK VALUATION | ONLINE ESTIMATE | |
|---|---|---|---|---|
| Prepared by | A Certified Practising Valuer | A real estate sales agent | A valuer instructed by the lender | An automated statistical model |
| Who the client is | You, or your instructing professional | You, at no charge | The lender | Nobody |
| Property inspected | Yes, internally and measured | Usually, briefly | Sometimes; often desktop or kerbside | No |
| States a basis of value | Yes | No | Yes, for lending purposes | No |
| Can be dated to the past | Yes | No | No | No |
| Evidence set out in the report | Yes, with analysis | No | Not disclosed to you | No |
| Carries professional liability | Yes | No | To the lender, not to you | No |
| Accepted by the ATO | Yes | Generally not | Generally not | No |
| Accepted by a court | Yes | No | No | No |
| Accepted by an SMSF auditor | Yes | Generally not | Generally not | No |
| Accepted by a revenue office | Yes | Varies by office and purpose | No | No |
| Cost | A fixed professional fee | Free | Paid by or through the lender | Free |
Acceptance rows reflect what these authorities require of evidence of market value; the requirements themselves are set out with their primary sources in the knowledge hub. Where a revenue office publishes a purpose-specific concession — Queensland, for example, accepts a market appraisal in some limited duty circumstances — the office’s own guidance governs.
One question decides it: who has to accept the number?
You need a valuation
An appraisal is fine
Agents are good at this and it costs nothing. The error is never using an appraisal — it is using one where a valuation was required, then discovering that months later. If you are not sure which side of the line you are on, call and describe the situation. We will tell you, and if the answer is that you do not need us, that is the answer you will get.
Six questions people actually ask.
Is a real estate agent appraisal the same as a valuation?
No. An appraisal is an agent’s opinion of the likely selling price, usually provided free, prepared to win or service a listing, and carrying no professional liability. A valuation is a formal opinion of market value at a stated date, prepared to a professional standard by a qualified valuer, setting out the comparable evidence and assumptions, and carrying professional indemnity. Courts, the ATO and state revenue offices accept the second and generally reject the first.
Will the ATO accept an agent’s appraisal?
Generally no. Where the tax law requires market value, the Australian Taxation Office expects an objective valuation supported by appropriate evidence, and states that valuations undertaken by professional valuers are more credible than those provided by someone who is not a professional valuer. An appraisal does not state a basis of value, does not set out the evidence relied on, and does not identify its assumptions.
Is a bank valuation the same as an independent valuation?
No, and the difference is who the client is. A bank valuation is instructed by the lender, for the lender, to assess security for a loan. You are usually not the client, may never see the full report, and cannot rely on it. It is often conservative by design and is not prepared for tax, court or revenue-office purposes. An independent valuation is instructed by you, addressed to you, and prepared for the purpose you specify.
What about online estimates and automated valuations?
An automated estimate is a statistical model applied to public data. It has not seen the property, does not know its condition, layout, fit-out or defects, and cannot account for anything unusual about the title. It is a useful starting point for curiosity and is not evidence. No court, revenue office or auditor accepts one, and nor should a material financial decision rest on one.
When is an appraisal actually the right choice?
When you are deciding whether to sell and want a view on likely selling price and marketing strategy from someone active in that market. That is what an agent does well, and it costs nothing. The mistake is not using an appraisal — it is using an appraisal where the law, an auditor or another party requires a valuation.
Can a valuation be prepared for a date in the past?
Yes. A retrospective valuation assesses market value as at a specified past date, using only the sales evidence that existed at that date. Appraisals, bank valuations and automated estimates cannot do this — they are current-date instruments. Retrospective dating is routine for dates of death, capital gains cost bases, separations and statutory objections.
Where this connects to the rest of the file.
What a report must contain, with 28 sources
The evidence standard behind every acceptance row in the table above, referenced to the issuing authority.
Why an appraisal fails an SMSF audit
What an approved auditor is looking for, and why a marketing opinion does not supply it.
Retrospective dates, which only a valuation can do
How market value at a past date is established, and why the other three documents cannot produce it.
What a valuation costs, and why
The four factors that set the fixed fee, and why a report that is not accepted is the most expensive option.