Wondering how price estimates are put together?

So I am a bit confused (not hard really ). When I use any of the price estimate sites (yes I know they are to be taken with a grain of salt) my place comes in a couple of hundred grand higher than my neighbors.

I should point out I live in a block of townhouses where my neighbors are the same as mine with the exception that I have concreted and pergolad my back yard.

How are these estimates compiled? Based on the purchase price and the most recent Sydney boom I would think the estimate for mine is more realistic and the neighbors ones are heavily undervalued as their represents a 40% increase in value in the last 9 years compared to a 90% increase on mine or in compounded terms, 5.4% vs 8.8% pa.

The only reason I am curious is because all the valuation sites basically have the same issue, do they all feed from 1 main stream (probably corelogic?)

 

They use a random number generator which is then tested against the number of keystrokes needed by the user to input their address (including any typing mistakes).

 

Question number two, does anyone pay for the insights and metrics from https://www.propertyvalue.com.au/ it's $400 a year (tax deductible maybe?) I don't see that as a massive amount but would like to know if anyone has it and thinks it's worth the money?

 

Do you use any other paid provider?
PriceFinder,RP Data etc

 

It simply calculates based on the recent sales in the suburb and your last purchased price. If you have any upgrades done since the last purchased, you could work from the figure...

 

We all bought brand new at the same time, all townhouses are the same, this is why I am confused .

 

Not currently the site I posted is part of the corelogic network (RP Data)

 

Who knows, but I know people who think they spit out gospel, when I tried to explain not to rely on them, I was given funny looks, so it has become like religion, not to be discussed

 

It would have something to do with the last price paid and how the suburb has gone.

My 4/2/1 renovated is worth about 15% less than the house across the road for a 3/1/1 unrenovated, both houses are on the same land size. Yes we have done further improvement but ours was renovated when we purchased.

However the lady across the road paid significantly more $$$ then me but it was years later.

My parents estimate is an absolute joke as they knocked down and rebuilt and everything about this house is superior than the house next door but theirs is worth more. My parents estimate is actually worth less than what they spent on construction cost.

 

I don't think KDR's are taken into account, the valuation of your parents place will be for the old place that was there, it will rebalance if they sell.

We all paid between 459 (what I paid) and 479 depending on how much people let the real estate squeeze them We all bought brand new within 3 months of each other and they are all the same (Attached to each other) with the exception of the end one's (not mine) as they have an extra half metre of land on the side of them that is detached.

This is why I can't understand it, on paper they should all be within 20 or 30 K of each other, they are exactly the same inside, same fittings, same age everything. It is perplexing.

 

Sweet, I'm gonna print out the one of the 3 that places mine at 1.1 mill and take it to the bank, I want to draw my equity out .

In all reality I reckon it's worth 850 .

 

Autovals generally arent worth the computer screen its written on

 

Then it would have no idea...i think. I built two new houses from a block before, and RP data has no record of it, except the old land purchase price.

 

Once they've sold, they won't care what it's worth - too late to back out.

 

Do not laugh, if the bank has a high val too, you can do it.

I have had access to more than expected before (and less) but I do not remember anything but physical valuers being used, I avoid the big boys that do these computer vals.

 

Strange enough the 4 units next to mine both sides same level, smaller, original paint, carpet flooring are higher than mine by 40k -55k. Mine is floorboards, New paint.

Another one is house, the estimate also lower than the other houses on the same street despite, mine is larger land size by 200m2.

Thought I could use domain, real estate, corelogic to check rough value to put the offer but now thinking, I could be wrong.
How do we check if property is undervalued or overvalued?

 

Know how much comparables sold for... use a free website sold section or use pricefinder or RP data or ask a broker for a report (which will show the sale prices of comparables)