What Is a Market Value Valuation?

A market value valuation is a formal assessment of what a property would sell for on the open market at a specific point in time. The legal definition? It's the price a willing buyer would pay a willing seller in an arm's length transaction, after proper marketing, with both parties acting knowledgeably and without pressure.

This is different from a bank valuation, which tends to be conservative because the lender is focused on protecting their loan security. It's also different from a real estate agent's appraisal, which may be influenced by their interest in winning your listing. A certified market value valuation is independent and unbiased. It's prepared by a qualified professional with no stake in the outcome.

When Do You Need a Market Value Valuation Report?

There are plenty of situations where knowing your property's true market value matters. Some are optional but smart. Others are legally required.

Buying or Selling Property

If you're selling, a market value valuation helps you set a realistic asking price based on evidence rather than guesswork. If you're buying, a pre-purchase valuation can confirm whether the asking price is fair or whether you're about to overpay. This is especially useful for off-market deals, private sales, or properties with no recent comparable sales nearby.

Refinancing or Accessing Equity

When you refinance or apply to access equity in your home, your lender will order their own valuation. But having an independent market value report gives you a clearer picture of your position before you start negotiations. It can also help if the bank's valuation comes in lower than expected — which happens more often than you'd think.

Family Law and Property Settlements

During separation or divorce, the family home is often the largest shared asset. An independent family law property valuation provides an impartial figure both parties can rely on. If the matter goes to court, you'll need a valuation from a certified valuer that meets Family Court requirements. There's no getting around it.

Deceased Estates and Probate

When someone passes away, their property needs to be valued for probate and estate distribution purposes. This establishes the asset's value at the date of death for legal and tax purposes. Executors often need a certified valuation to satisfy the requirements of beneficiaries, solicitors, and the ATO.

Tax and Compliance Purposes

The ATO requires market valuations for a range of tax matters. If you're selling an investment property, you may need a capital gains tax valuation to establish your cost base. Transferring property between family members or into a trust typically requires a stamp duty valuation for the state revenue office. And if your self-managed super fund holds property, you'll need an annual SMSF property valuation to meet compliance obligations.

What Factors Affect Your Property's Market Value?

No two properties are the same, and neither are their values. A certified valuer considers a range of factors when assessing market value.

Location is typically the biggest driver. Properties close to schools, public transport, shops, and employment hubs tend to command higher prices. The specific street, aspect, and views also play a role. Two houses in the same suburb can have very different values depending on where they sit. In our experience, a quiet cul-de-sac versus a busy main road can mean tens of thousands of dollars difference.

The property itself matters too. Size, layout, number of bedrooms and bathrooms, age, condition, and quality of finishes all influence value. Recent renovations can add value, but not always dollar-for-dollar. The valuer also considers the land size, zoning, and any development potential. Current market conditions and recent comparable sales in the area help establish where your property sits relative to others.

How Do Property Valuers Calculate Market Value?

Certified property valuers use established methodologies to arrive at an objective market value. The approach depends on the property type and what the valuation is for.

Direct Comparison Approach

This is the most common method for residential properties. The valuer analyses recent sales of similar properties in the same area and makes adjustments for differences in size, condition, features, and location. It relies on actual market evidence to establish what buyers are willing to pay. Pretty straightforward, and it's the method most people are familiar with.

Summation Method

This approach calculates the value of the land and the value of the improvements (buildings, landscaping, pools, and so on) separately, then adds them together. It's useful when comparable sales are limited or when the property has unique features that make direct comparison difficult.

Income Capitalisation

For investment and commercial properties, valuers may use the income approach. This involves analysing the property's net rental income and applying a capitalisation rate derived from comparable market transactions. It reflects how investors assess value based on return. Different method, different lens.

What's Included in a Market Value Valuation Report?

A certified market value valuation report provides detailed information to support the valuer's conclusion. The level of detail depends on the report type (short form or long form), but most reports include the following:

Short form reports are suitable for most private purposes. Long form reports provide more detailed analysis and are typically used for litigation, high-value properties, or complex situations.

Why Choose a Certified Property Valuer?

Not all valuations are equal. A certified property valuer holds qualifications recognised by the Australian Property Institute (API) and operates under strict professional and ethical standards. Their reports are accepted by banks, courts, government agencies, and the ATO.

Here's the thing: bank valuers work for the lender, not for you. Real estate agents provide appraisals, but these aren't independent and can't be used for legal or tax purposes. A certified valuer has no conflict of interest. Their job is to provide an objective, evidence-based opinion of your property's market value.

At Alliance Australia Property, our valuers are API-accredited Certified Practising Valuers with local market expertise. We provide independent valuations for all property types across Australia, with clear reports and fast turnaround times.

8 FAQs About Market Value Property Valuations

What is market value in property valuations?

Market value is the estimated price a property would sell for on the open market at a specific date, assuming a willing buyer and willing seller acting without pressure after proper marketing. It's the standard definition used by valuers, lenders, courts, and the ATO.

How is market value different from a bank valuation?

A bank valuation is ordered by your lender to assess loan security. It's often conservative because the bank wants to minimise their risk. A market value valuation is independent and aims to reflect the true price a property would achieve if sold on the open market.

Do I need a market value valuation to sell my property?

It's not legally required, but it's a smart move. A market value valuation gives you an evidence-based figure to guide your pricing strategy, rather than relying on agent opinions or online estimates that may not reflect your property's true worth.

How long does a market value valuation take?

For most residential properties, you can expect a completed report within 5 to 10 business days after the inspection. Turnaround times may vary for complex, rural, or commercial properties.

Can I use a market value report for the ATO?

Yes. A certified market value valuation from a qualified valuer meets ATO requirements for capital gains tax, stamp duty, and SMSF compliance purposes. The report needs to include all required information and be prepared by a suitably qualified professional.

What's the difference between market value and appraised value?

Market value is determined by a certified valuer using established methodologies and market evidence. An appraised value is typically an informal estimate provided by a real estate agent, often as part of a listing pitch. Only a certified valuation has legal standing.

How often should I get a market value valuation?

It depends on your situation. SMSF trustees need annual valuations for compliance. For other purposes, a valuation is usually needed at a specific point in time — when buying, selling, refinancing, or settling a legal matter.

Do market value valuations include renovations and improvements?

Yes. The valuer inspects the property and considers all improvements, including renovations, extensions, landscaping, and added features. That said, not all improvements add dollar-for-dollar value. The valuer assesses the contribution based on what the market actually pays for those features.

Ready to know your property's true market value?

Get a quote for your market value property valuation today, or give us a call to speak with one of our certified valuers.