Selling a farm
Farm appraisal vs registered valuation: what's the difference?
Doug Wakelin, Rural/Lifestyle Sales Consultant, Property Brokers Te Awamutu
Short answer. An appraisal is a real estate agent's opinion of what a property might sell for, usually given free to help a vendor decide. A registered valuation is a formal report from a registered valuer, usually paid for and often asked for by banks. They can differ. Neither guarantees a sale price.
Compare
| Appraisal | Registered valuation | |
|---|---|---|
| Who | Real estate agent | Registered valuer |
| Cost | Usually free | Paid for. Fees vary by valuer and property, so ask for a quote. |
| Purpose | Help a vendor decide whether and how to sell | Lender security, estate, tax or legal purposes |
| Format | Opinion, often with comparable sales | Formal written report with method |
| Who asks | Vendor | Bank, vendor, buyer, accountant, solicitor |
| Promise of a sale price? | No | No |
When you might want both
- Vendor: an appraisal to get started, and a valuation if you're dealing with an estate, a partnership, a bank or a tax question.
- Buyer: your lender may ask for its own valuation as a condition, see farm finance.
What goes into a farm appraisal
- The land: effective hectares, contour, soils, water, fencing.
- The improvements: houses, sheds, yards, effluent systems.
- Recent comparable sales in the district.
- The rules and risks: freshwater plans, consents, ETS and trees.
- Market conditions. See when to sell.
Check before you rely on this
General information only. Check with your solicitor, accountant and valuer.