What is the function of a property appraisal?

The primary function of a property appraisal is to provide an opinion of the property's market value. Appraisals are conducted by certified professionals who assess various factors, including the property's condition, location, comparable sales, and market trends. This comprehensive evaluation results in a valuation that reflects what the property is worth in the current market.

While estimating potential rental income, ensuring compliance with safety regulations, and determining the seller's asking price may all be important aspects of real estate transactions, they are not the central purpose of a property appraisal. The appraisal's focus is distinctly on market value, which is essential for various uses, such as financing, tax assessments, or determining sale prices. This understanding is crucial for real estate professionals when advising clients on pricing, financing options, and investment decisions.