How to read a property report: what each part of your free report means

What a property report is

A property report is a short summary of what the records say about a home: an estimated value and price range, how confident that estimate is, the home's details and sales history, recent sales nearby and how the suburb has been tracking. It is put together automatically from sales records and property data, which is why it can be free and arrive in minutes. No one has inspected the home, so it is a starting point for working out a price.

What our free report includes

Every report covers the same ground: an estimated value with a price range, how confident that estimate is, the details on record for your home, its sales history, where it sits in the suburb, recent sales nearby and a snapshot of the local market. Then your local agent gives you a call to go through it with you, because a few things never show up in data.

Here is each part in turn, what it tells you, and what to check before you rely on it.

1. The estimated value and the price range

The headline is a single estimated value, with a low and a high figure either side. Read the range first. The single number sits in the middle of what the model thinks is likely. No buyer has agreed to pay it.

The estimate comes from an automated valuation model that works from official NSW sales records and property data. It is dated, so it reflects the market on the day it was produced. If your report is a few months old, use it as a starting point and expect the market to have moved.

Expect the range to be wider when the data is thin. In mountain towns, where two homes in the same street can be very different, a wider spread is normal. In a suburb full of similar homes it is usually tighter.

2. The confidence rating

Next to the estimate sits a confidence rating, shown on a coloured scale from red for low to green for high. It answers one question: how much good data was there to work with?

• High: plenty of recent sales of similar homes nearby, and solid records for your home.
• Medium: some useful sales, but fewer of them, older, or less alike.
• Low: few comparable sales, or records for your home that are incomplete.

A low rating does not mean your home is worth less. It means the number needs more checking, and that is exactly when a local opinion matters most.

3. The details on record for your home

The report lists what the records say about your property: bedrooms, bathrooms, car spaces, floor area, land size, property type, land use and zoning where it is known. Some fields, such as the year built, are often blank for older homes.

Check these carefully. Records fall out of date. A third bedroom added in a renovation, a converted garage or a second bathroom may never have made it into the data, and the estimate is built on what the records say. If something is wrong, mention it when your agent calls. Fixing one wrong detail can move the figure more than anything else on the page.

4. Sales history

You will see when your home last sold and what it sold for, going back as far as the records allow. These come from official NSW sales records.

Old sale prices are interesting, but on their own they say little about today's value. They are more useful for showing how long a home has been held, and for spotting a sale that may not have been at market value, such as a transfer within a family.

5. Location

A location page shows where the property sits, so you can see it in relation to the rest of the suburb. It is a quick reminder of something every buyer weighs up: two similar homes can sell for quite different prices depending on the street, the walk to the station and shops, and which side of town they are on.

6. Recently sold homes nearby

This is the part most people spend the longest on, and rightly. The report lists recent sales close to your home. For each one you get the sale price, the sale date, how far it is from your property, the bedrooms, bathrooms and car spaces, the floor area, the land size, and the features recorded for that home, such as floorboards, an ensuite, a lockup garage, heating, the building materials or the zoning.

How to read the nearby sales

• Start with the most similar home rather than the nearest one. A home with the same number of bedrooms and a similar block half a kilometre away is a better comparison than a much bigger home next door.
• Check the dates. A sale from last month tells you more than one from a year ago, especially while prices are moving.
• Compare floor area as well as bedrooms. Two three-bedroom homes can differ by 30 or 40 square metres, and that gap is often where the price difference sits.
• Read the features. Brick or weatherboard, an ensuite, a garage, good heating: buyers pay for them, and in the cold upper mountains heating counts for more than most people expect.
• Note the distance. Within one suburb, the side of the highway, the walk to the station and the outlook can matter as much as size.

No single sale is your price. Lined up together, they show you roughly where your home sits and why.

7. The suburb snapshot

The last data page covers your suburb as a whole: the median price for houses and for units, the number of sales in each of the last five years, and the capital growth recorded each year.

• The median is the middle sale. It is different from the average. Half the homes sold for more and half for less. Yours could sit well above or below it.
• The number of sales shows how active the market is. A year with fewer sales usually means less choice for buyers and less evidence for pricing.
• Yearly growth shows the trend. It does not predict next year. A strong year is often followed by a flatter one, and houses and units do not always move together.

Reading a report when you are buying

The same pages work just as well for a home you are thinking of buying. Use them to test the asking price before you inspect or make an offer:

• Put the asking price next to the range. A home listed well above the top of the range needs a reason, such as a renovation the records have missed.
• Find the two or three most similar recent sales. They tell you more about a fair offer than the estimate does.
• Look at the last sale. A recent purchase followed by a quick resale can point to work done on the home, or to a seller testing the market.
• Remember what the report leaves out. It says nothing about the building's condition. A building and pest inspection does, along with the free official checks every NSW buyer can run.

What an automated estimate cannot see

Every automated estimate is produced by a computer model from the data available, without anyone visiting the home. The fine print on any report like this says so, and it is worth taking seriously. The model cannot account for:

• condition and state of repair
• renovations and improvements that are not on record
• views and aspect, including which way the living areas face
• layout, natural light and how the home feels to walk through
• road noise, a steep driveway or an awkward block
• environmental issues and anything particular to your street

These are often the first things buyers notice, so treat the report as the start of the conversation about price.

Report, appraisal or valuation?

People use these words as if they mean the same thing. They are three different products:

• Property report: automated, free and quick. Good for a first figure and the local sales picture.
• Appraisal: a licensed agent's opinion of what the home would sell for, based on the home itself and recent sales. Usually free.
• Valuation: a formal assessment by a registered valuer who inspects the property, used for lending, legal and tax purposes. You pay for it.

More on the difference in appraisal vs valuation in NSW.

A five-minute check of any report

1. Read the range and the date before the single figure.
2. Check the confidence rating, and treat a low one as a reason to dig further.
3. Correct anything wrong in the home's details, such as bedrooms, bathrooms or land size.
4. Pick out the two or three nearby sales most like the home, and note how recent they are.
5. Glance at the suburb trend for context.

Where your local agent comes in

After your report arrives, Matt, our approved local agent, gives you a call to go through it. That call is where the gaps get filled. Matt checks the details on record, asks about anything the data has missed, and tells you which of the nearby sales really compare with your home and which do not. You come away with a realistic range and a clear idea of what would move it up or down.

There is no fee and no obligation. If you are selling soon, you get a price to plan around. If you are years away, you find out where you stand today.

Comparing free reports from different places first? Read about the four types of free property report in NSW and why online estimates disagree.