What is the purpose of a property appraisal?

The primary purpose of a property appraisal is to estimate the market value of a property. This involves a thorough analysis of various factors such as the property’s location, condition, and comparable sales in the area. The appraisal provides a fair and unbiased value that can help buyers, sellers, lenders, and investors make informed decisions.

Market value is crucial in many real estate transactions, particularly for financing purposes, where lenders require an appraisal to ensure that the loan amount is justified by the property's worth. An accurate appraisal can help ensure that the property is priced appropriately in the market, avoiding overpricing or underpricing which can lead to financial repercussions for any party involved in the transaction.

While assessing property taxes, providing legal descriptions, and determining renovation costs are all important aspects of real estate, they serve different purposes and do not represent the fundamental goal of an appraisal, which centers around determining the fair market value of the property.