Don't rely solely on online property valuations

Online property valuation tools are plentiful. They are also frequently found on real estate agent websites. Generally, you only need to enter a few key details – and that's it. You immediately have an initial valuation. However, many owners are unaware that this is only a general guideline. Unlike a professional appraisal, the data on which an online valuation is based is not verifiable. Therefore, it does not provide a suitable basis for setting an asking price.

What do you do when you're looking for the answer to any question? Exactly, you first go online or ask your digital voice assistant. And if you want to know how much your property is worth, you'll very quickly find yourself on an online valuation tool. But what exactly does such a tool show you after you've entered some data like location (postal code), living space, number of rooms, type, and condition of the property?

What data an online calculator uses remains its secret

The tool compares your entered data with similar properties that have recently sold and outputs a price based on this comparison. How closely this calculated price reflects the actual market value of your property depends, firstly, on the quality and recency of the data used by the valuation tool's algorithm. Secondly, it also depends on how well your property compares to others. Individual property characteristics can only be factored into an online calculation to a very limited extent.

Data availability is typically better in large cities, as more properties are sold there than in sparsely populated regions, resulting in more recently achieved sales prices available for comparison. A disadvantage is that you cannot verify which data is actually being processed. If this data is inaccurate, for example, because asking prices are used instead of actual sales prices, this will naturally skew the results.

An online valuation is good for orientation, but there's more to determining the price!

All of this does not mean that using such valuation tools should be discouraged altogether. They provide you, as the owner, with a very useful initial estimate. However, experts warn against relying solely on this initial rough valuation and mistaking the online tool's reliability for that of a professional appraisal. The value displayed by the online calculator can in no way replace a professional appraisal. It would be a mistake to use it as a starting point for an asking price – not least because you would then lack a solid basis for argumentation during later price negotiations.

Only a professional real estate agent who is thoroughly familiar with the market situation in your region can determine a truly realistic market value for your property after a viewing. Their approach is transparent and comprehensible for you as the owner. They know what they are doing and can explain each step to you. Based on this, you and your agent will arrive at a suitable starting price for your property. This is – as you may already know – one of the most important steps in achieving the best possible price when selling.

Would you like to know exactly how much your property is worth? Contact us! We'd be happy to advise you.

Legal notice: This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.

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