Appraisal vs market price: why the two numbers disagree

What an appraisal actually models

An appraisal is a statistical model. It reads attributes it can measure — length, extension, dictionary status, link signals, age — and outputs the value those attributes typically carry. It is consistent, fast and immune to enthusiasm, which makes it excellent for ranking a shortlist.

What it cannot see is intent. It does not know a funded startup just launched under a near-identical name, or that the category is suddenly fashionable.

What market price adds

Market price encodes urgency, budget and competition. A single motivated end user can pay ten times an appraisal because the alternative — rebranding, or living with an awkward name — costs more. Equally, a domain with no interested buyer sells below appraisal or not at all, no matter how good the metrics look.

• Who wants it — one buyer or many.
• How quickly they need it.
• What their alternatives cost.
• Whether the seller can afford to wait.

Using both numbers in a negotiation

Open with comparables and keep the appraisal as a floor. If the appraisal is well above the offer, use it to justify holding. If comparables are well above the appraisal, the model is missing something qualitative — usually brandability or category heat — and you should trust the market.

A practical workflow

Run the appraisal on every candidate first, because it is cheap and consistent. Then compare the top two or three side by side on the signals that matter to your plan, and only then research comparable sales for the finalist. Doing it in that order stops you spending research time on names that were never going to make the shortlist.

Frequently asked

Why do two appraisal tools give different numbers?

Each tool weights attributes differently and uses a different sales dataset. Use one tool consistently for relative comparison rather than treating any single figure as truth.

Should I share my appraisal with a buyer?

Only if it supports your position. Buyers discount appraisals they did not commission, so comparable sales usually carry more weight in a negotiation.