What is the purpose of a real estate appraisal?

The primary purpose of a real estate appraisal is to determine the fair market value of a property. This involves a professional assessor analyzing various factors such as the property's location, size, condition, recent sales of comparable properties, and market trends. An accurate appraisal is essential for multiple reasons, including facilitating transactions, establishing property tax assessments, and guiding lenders in determining loan amounts. Understanding the fair market value is crucial for buyers, sellers, and investors, as it helps them make informed decisions in real estate transactions. By having a precise value, stakeholders can negotiate sale prices appropriately and ensure that they are not overpaying or underselling a property.