When you decide to sell your most valuable asset, the first question is always: “What is my home really worth?”
Most sellers start by checking online estimators or looking at municipal tax assessments. But if you’re serious about maximising your sale price, you have two distinct ways to value your property – and both are crucial to your success.
The first is a professional appraisal by a qualified valuer; the second is a Comparative Market Analysis (CMA) provided by your real estate agent.
Confusing the two is one of the most common mistakes a seller makes.
A professional appraisal or valuation is a formal, legally defensible and unbiased opinion of value conducted by a licensed appraiser – a third party with no financial stake in your sale.
The role of the valuer is indispensable for refinancing, estate settlements and divorce proceedings because their judgment is grounded in historical evidence and strict industry standards. They rigorously analyse:
Comparable recent sales with detailed adjustments.
Property-specific factors, such as structural condition, location influences (e.g. proximity to a busy street), and renovations.
Current market trends to ensure the valuation stands up to scrutiny from banks or the Canada Revenue Agency.
The professional appraisal acts as a financial safety net and the definitive “floor” value for a lender.
If a buyer needs financing, the lender will require a valuation report to ensure it’s not lending more money than the property is worth. If your contract price exceeds the appraised value, the sale may fall through.
When it comes to attracting buyers in the current market, you need the strategic insights of your real estate agent and a Comparative Market Analysis (CMA). This is not a legal document but a pricing analysis based on recent sales of similar properties in your area. It informs your pricing strategy.
While both a valuer and an agent look at comparable sales, the agent’s analysis adds critical real-time layers, such as:
Current competition: A valuer focuses on the value of property deals that have closed. Agents not only do this but factor in properties currently on the market. They should know which homes your property is competing against, and how aggressively you need to price to capture a buyer’s attention.
Market momentum – Your agent understands market psychology. Is the neighbourhood seeing bidding wars? Are buyers price-sensitive? They factor in the current demand to estimate the price range.
Priced to sell – Your asking price will depend on the sales strategy agreed with your agent. For example, you may see the logic in under-pricing your home slightly to encourage multiple offers, knowing that competition often drives the final price well above the list price.
In short, a valuer tells you what your home is worth in an unbiased, legal sense. A CMA tells you what it might sell for using real-time market tactics.