What Price Guides Really Mean and How Buyers Turn Them Into an Advantage
Price guides are a public shorthand used to set buyer expectations. They are useful but often misunderstood. This post explains how guides are shown, what they legally represent, how they differ from reserve prices, why advertised guides should be updated after new information and how Ralph & Ralph use guide-versus-sale data to give buyers an edge.
How price guides are displayed and how to read them
Price guides are shown either as a range (for example $2.5m to $2.75m) or as a single figure (for example $2.5m)
Market convention treats a single figure as implying a notional range that typically reaches about 10% higher (so $2.5m is commonly interpreted as roughly up to $2.75m) though some advertised ranges are exactly 10% and others differ.
A guide is an informed estimate for marketing purposes, not a promise of sale at that figure. Buyers should use comparable recent sales and agent-specific track records to test whether a guide is realistic.
At Ralph & Ralph, we can do the heavy lifting for you to help you know what each property is worth and what each agent is expecting.
Legal and practical difference between price guides and reserve prices
A price guide is an advertising estimate that reflects the marketing position agreed in the agency agreement between vendor and agent.
A reserve price at auction is the confidential minimum the vendor will accept. The reserve is a vendor decision and not determined by the agent.
Practically, a property can be advertised with a conservative guide while the vendor’s reserve is higher, so a low guide does not guarantee a low reserve.
To find out more, read the NSW Fair Trading underquoting guidance.
When guides should change and buyer implications
Agents are required to keep their public advertising consistent with the reasonable estimate recorded in the agency agreement. If the evidence available to the agent or vendor changes (for example, when an offer is received and rejected) the reasonable estimate should be updated and the guide adjusted.
Some campaign practices delay explicitly rejecting an offer (for instance by continuing negotiations or keeping an offer on hold). Those practices can keep the originally advertised guide in place even though the vendor has effectively acted on new pricing information. This creates a situation where the advertised guide no longer reflects the best available information. Buyers should therefore be alert when a guide remains unchanged despite clear market activity.
Practical buyer action: when you see a long-running campaign with an unchanged low guide, ask your adviser to investigate recent private offers, prior bids, or vendor instructions.
How Ralph & Ralph use price guide data to give clients an advantage
We collect and analyse data comparing advertised price guides with final sale prices. That gives us an empirical measure of how individual agents and campaigns perform relative to their guides.
From that analysis we calculate an agent’s typical sale premium above the bottom of the guide. If an agent routinely sells well above the guide, that signals conservative guiding. If they sell close to or below guide, their guides are realistic or optimistic. We can use this data to predict a value the agent expects as well as our data to provide what we believe the home is worth.
We use those statistics to:
advise buyers which listings are more likely to have low guides relative to outcomes
set realistic pre-auction negotiation thresholds and bid limits for clients
avoid emotionally driven inspections and auctions that expose buyers to overpaying
This localised, agent-specific insight is central to our buyer representation: it reduces surprises and increases bargaining power.
Extra practical tips for buyers when evaluating a price guide
Compare the guide to recent comparable sales in the same suburb and in similar property condition.
Research the specific agent’s track record for sale-to-guide outcomes. Patterns over multiple listings reveal useful trends.
For properties you’re serious about, ask your adviser to approach the selling agent for context on vendor expectations while remembering the reserve is the vendor’s private decision.
If a guide seems unusually low for the market, treat it as an invitation to investigate rather than assumed value. There may be competing offers, unusual vendor conditions, or strategic marketing at play.
Summary and next steps
Price guides are a marketing and disclosure tool, not a guarantee. They reflect the agent’s marketing estimate recorded in the agency agreement, while reserve prices are decided by vendors and remain confidential. Guides should be updated when meaningful new information emerges. If they are not, buyers should be cautious and seek more information. Using our proprietary guide-versus-sale dataset, Ralph & Ralph help clients read guides accurately, pick the right listings, and craft winning, data-driven offers.