When Beneficiaries Start Comparing House Sigma, Zillow, and Realtor Estimates to the Estate Appraisal
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- 7 min read
"The estate appraisal says the property was worth $1.25 million, but HouseSigma shows $1.4 million. Which one are we supposed to believe?"
It is a question that can quickly create uncertainty in an estate administration.
An executor obtains an independent appraisal.
The report provides an opinion of market value supported by comparable sales and market analysis.
Then a beneficiary searches the property online.
Within minutes, they may find a different number on HouseSigma, Zillow, or another real estate website.
Another beneficiary may speak with a Realtor and receive yet another estimate.
Suddenly, a valuation that initially appeared straightforward becomes the subject of disagreement.
The problem is that these numbers may look like they are answering the same question.
Often, they aren't.
Not Every Property Value Is Prepared for the Same Purpose
One of the most important distinctions is understanding what each number actually represents.
An estate appraisal may be prepared to determine the property's market value as of a specific historical date, such as the owner's date of death.
An online estimate may represent an automated estimate of the property's approximate current value.
A Realtor may provide an opinion about an appropriate current listing price or expected selling range.
Those can all be useful pieces of information in the right context.
But they are not necessarily interchangeable.
For estate purposes, the relevant question may be:
"What was the property's market value on the required effective valuation date?"
That is a much more specific question than:
"What might this property sell for today?"
A Common Estate Scenario
Consider a hypothetical example.
A homeowner passes away in March 2025.
The estate requires a retrospective appraisal of the property as of the date of death.
The appraiser analyzes sales around March 2025 and concludes a market value of $1.20 million.
Several months later, a beneficiary checks an online real estate platform.
The website displays an estimated value of $1.32 million.
The beneficiary understandably asks:
"Why is the estate appraisal $120,000 lower?"
At first glance, that difference may appear concerning.
But the two numbers may relate to completely different points in time.
If the local real estate market changed after March 2025, today's automated estimate does not automatically establish what the property was worth on the earlier date.
The Effective Valuation Date Matters
This is particularly important in estate appraisal assignments.
Real estate markets move.
Interest rates change.
Inventory rises and falls.
Buyer confidence changes.
Individual neighbourhoods can strengthen or weaken.
A property worth $1.20 million on one date might reasonably be worth $1.30 million at another.
Neither value is necessarily wrong.
They may simply answer different questions.
That is why an estate appraisal should clearly identify its effective valuation date.
The comparable sales and market evidence should then be analyzed in relation to that date.
Automated Estimates Don't Inspect the Property
Another important distinction involves the property itself.
Automated valuation systems generally rely on available property data, historical transactions and mathematical models.
They do not physically walk through the home.
That means an automated estimate may not fully recognize characteristics such as:
Interior condition.
Quality of renovations.
Deferred maintenance.
Functional layout.
Basement finish.
View or location influences.
Quality of workmanship.
Unusual property characteristics.
Two houses can appear similar in a database while purchasers may view them very differently.
One may have undergone extensive renovations.
The other may require substantial updating.
Those differences can affect market value.
A professional residential appraisal can consider the characteristics of the specific property rather than relying solely on an automated estimate.
A Realtor Estimate Can Be Useful—But It May Answer a Different Question
Realtors work directly in the real estate market and can provide valuable insight into buyer activity and potential selling strategies.
However, a Realtor's pricing analysis and an appraisal do not necessarily have the same purpose.
A Realtor may be considering:
"At what price should we list this property to attract buyers?"
or:
"What could we reasonably expect this property to sell for in today's market?"
An estate appraiser may instead be answering:
"What was the property's market value on the owner's date of death?"
Those are fundamentally different assignments.
A current listing strategy should therefore not automatically be used to judge the reliability of a historical estate appraisal.
The Highest Number Isn't Automatically the Most Accurate
When beneficiaries encounter several different estimates, there can be a natural tendency to focus on the highest one.
Imagine the following:
Estate appraisal: $1.25 million
Online estimate: $1.36 million
Realtor estimate: $1.40 million
A beneficiary may understandably wonder whether the estate appraisal undervalued the property.
But choosing the highest number does not establish market value.
The more useful questions are:
What date does each value represent?
What information was considered?
What methodology was used?
Was the specific property actually inspected?
What comparable sales support the conclusion?
The credibility of a valuation comes from the evidence behind it—not simply from whether the number is higher or lower.
Comparable Sales Need Context
Online platforms can make comparable sales appear deceptively simple.
A beneficiary may find a house around the corner that sold for $150,000 more than the appraised value and conclude:
"This proves the appraisal was too low."
But there may be important differences between the two properties.
Perhaps the neighbouring property was:
Significantly larger.
Extensively renovated.
Located on a superior lot.
Equipped with a professionally finished basement.
Sold under different market conditions.
The fact that two properties are geographically close does not necessarily mean they have the same market value.
Comparable sale analysis involves understanding why buyers paid different amounts for different properties, not simply identifying nearby transactions.
The Property's Later Sale Can Create Even More Confusion
Suppose the estate property is eventually listed and sells for considerably more than the retrospective appraised value.
A beneficiary may say:
"The appraiser said $1.2 million, but we sold it for $1.35 million. Clearly the appraisal was wrong."
Not necessarily.
Suppose the appraisal's effective date was January and the property sold in October.
During those nine months:
Market conditions may have changed.
Buyer demand may have increased.
Repairs may have been completed.
The property's condition may have changed.
Inventory may have declined.
The later selling price establishes what a purchaser paid on the later sale date.
It does not automatically establish what the property was worth nine months earlier.
This distinction frequently causes confusion in retrospective valuation matters. Although written in the context of family law, our article "When One Spouse Claims the Home Was Sold Below Market Value"
discusses the same fundamental appraisal principle: a later transaction must be considered in the context of the effective valuation date and the market conditions that existed at that time.
Online Estimates Can Still Be Useful
None of this means online real estate tools have no value.
They can be useful for:
General market research.
Reviewing nearby sales.
Following neighbourhood activity.
Understanding broad pricing trends.
Identifying transactions that may warrant further investigation.
The problem occurs when an automated estimate is treated as though it is equivalent to a property-specific professional appraisal prepared for a defined purpose and effective date.
They are different tools designed to answer different questions.
An online estimate can raise a reasonable question.
But the estimate itself does not necessarily answer that question.
What Should an Executor Do When a Beneficiary Challenges the Appraisal?
A beneficiary questioning an appraisal does not necessarily mean the estate immediately needs another appraisal.
A useful first step may be understanding why the beneficiary believes the valuation is incorrect.
Is the concern based on:
An online estimate?
A nearby sale?
A Realtor's opinion?
The property's eventual selling price?
An incorrect property characteristic?
A genuinely relevant comparable sale?
If specific market evidence is identified, the appraiser may be able to explain whether it was considered and why it was—or was not—relevant to the analysis.
That can be considerably more productive than simply comparing competing numbers.
A Good Estate Appraisal Should Explain the Number
An appraisal should provide more than a conclusion of value.
A well-supported estate appraisal should allow the executor, beneficiaries and professional advisors to understand how the opinion was developed.
That generally includes:
A clearly identified effective valuation date.
Description and analysis of the subject property.
Relevant market conditions.
Appropriate comparable sales.
Adjustments where warranted.
Assumptions and limiting conditions.
A reasoned reconciliation of the market evidence.
The report should also be prepared in accordance with the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP).
Ultimately, scrutiny of an appraisal should focus on the evidence, methodology and reasoning supporting the opinion rather than simply whether another source produced a different number.
For a related discussion about what makes the underlying analysis important, you may also find our article "What Courts Actually Look For in a Real Estate Appraisal" helpful:
When a Different Number Deserves a Closer Look
It is also important not to dismiss every competing estimate simply because it came from an online platform or a Realtor.
Sometimes a beneficiary may identify information that genuinely deserves consideration.
Perhaps a highly comparable property sold around the effective valuation date.
Perhaps an important renovation was overlooked.
Perhaps the appraisal contains incorrect information about the subject property's size or characteristics.
A professional appraisal should be capable of being questioned.
The important distinction is between raising a legitimate market-evidence question and assuming that a different number automatically proves the appraisal is wrong.
If relevant new information emerges, it can be reviewed in the context of the original valuation analysis.
Final Thoughts
HouseSigma, Zillow and Realtor estimates have made property information more accessible than ever.
That can be useful.
But greater access to property data can also create confusion when several different numbers are presented as though they all represent the same thing.
For estate lawyers and executors, the most important question is not:
"Which source gives the highest value?"
It is:
"Which valuation actually answers the question the estate needs answered, for the correct property and the correct effective date?"
An online estimate may provide a useful reference point.
A Realtor may provide valuable insight into today's selling market.
But when an estate requires a property-specific opinion of market value as of a defined historical date, the analysis needs to focus on the property, the relevant comparable sales and the market conditions that existed at that particular point in time.
When beneficiaries raise questions based on online estimates, the solution is not necessarily to dismiss those numbers.
It is to bring the discussion back to the underlying evidence.
What date is being valued? What property characteristics were considered? What comparable sales support the conclusion? And what market conditions existed at the time?
Those questions can turn a disagreement over competing numbers into a much more useful discussion about the actual market evidence supporting the estate valuation.
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