Appraisal
The act or process of developing an opinion of value for a property, performed by a licensed or certified appraiser following recognized methods and professional standards. An appraisal results in a documented, supportable value conclusion as of a specific date.
An appraisal is more than a number — it is a structured analysis governed by USPAP that identifies the property, the property rights being valued, the intended use and users of the report, and the effective date of value. The appraiser gathers and verifies market data, applies one or more recognized valuation approaches (sales comparison, cost, income), and reconciles the results into a final opinion. What distinguishes an appraisal from a broker price opinion or an automated estimate is independence, accountability, and documentation: the appraiser must be impartial, the conclusion must be supportable from the workfile, and the appraiser certifies the work under penalty of professional discipline.
Related Terms
Uniform Standards of Professional Appraisal Practice (USPAP)
USPAPThe nationally recognized ethical and performance standards for the appraisal profession, established by The Appraisal Foundation.
Scope of Work
The type and extent of research and analysis performed in an appraisal assignment.
Effective Date (Date of Value)
The date on which the appraiser's opinion of value applies.
Valuation
The process of estimating the worth of an asset.
Certified Appraiser
An appraiser holding a state certification — Certified Residential or Certified General — earned through education, supervised experience hours, and a national examination.
More in Appraisal Process
View allExtraordinary Assumption
An assumption that is directly related to a specific assignment and, if found to be false, could alter the appraiser's opinions or conclusions.
Hypothetical Condition
A condition that is contrary to known fact but is assumed for the purpose of analysis.
As-Is Value
The value of a property in its current physical condition, as of the effective date of the appraisal, without any hypothetical conditions or extraordinary assumptions about future improvements or changes..
Prospective Value
A forecast of a property's value at a future date, based on anticipated changes in market conditions, property improvements, or other factors.