What is a home appraisal?
If you have ever bought or sold a home, you’re likely familiar with home appraisals. But if you’re a new buyer or it’s been a while, there are details about home appraisals to keep in mind.
Any real estate transaction requires an estimated value of the home. The most common method of getting the valuation is a home appraisal. During the appraisal process, a licensed assessor visits the property and gives their opinion on what the house is worth. This amount is then used by lenders to decide how much to lend for a mortgage on the property.
A home appraisal is conducted by a certified assessor who comes to the home and gives an estimated value of what it’s worth. They give their opinion on the value by looking at the home and comparing it to similar ones in the area.
Lenders often use the appraisal amount when calculating how much to give a borrower for a mortgage.
How do home appraisals work?
Home appraisals are pretty consistent in terms of what they look at to come to a property valuation. The appraiser has a list of items to look at and walks through the property before making a comparison to other properties. They typically take photos of the property and sometimes go to the comparable properties and take photos of the outside of those homes as well.
A licensed assessor will visit the home to conduct an appraisal.
How much does a home appraisal cost?
An appraisal can cost anywhere from $200 to $600, depending on your location.
The amount is paid at closing and the buyer usually pays for the home appraisal, but you can sometimes negotiate with the seller to cover the cost. If a seller wants to get an appraisal for their own purposes, they pay for it.
What do home appraisers consider during an appraisal?
Each appraiser has a list of things to consider (both indoors and outdoors) to calculate the value of the home. Some of the most common items include:
- The year the home was built
- Location
- Size of home and lot
- Bedrooms and bathrooms
- Foundation and structure
- Roofing
- Landscaping
- Lighting and fixtures
- HVAC system
- Amenities like an outdoor kitchen or sunroom
- Unattractive features
- Pool systems
- Upgrades or improvements
One of the most important parts of an appraisal is the comparison to similar homes. The appraiser will look at the items in your home and see how the condition compares to other properties recently sold in the area. Comparable properties are usually similar in size, number of bedrooms, year built and neighborhood.
Appraisal vs. home inspection
An appraisal determines the value of a home and is not the same as a home inspection. A home inspection is usually done before closing on a property to make sure there are no problems that need to be addressed, such as roof leaks, a broken HVAC unit or plumbing issues.
How to read your appraisal report
When you receive a copy of a home’s appraisal report, be sure to review it thoroughly. Here are some highlights to look for as you read it:
- See the appraised value of the property. This number is likely the part of the report you’re most interested in (and arguably the most important part when it comes to a seller’s asking price and a buyer’s mortgage loan amount).
On the Uniform Residential Appraisal Report, you can find this information at the bottom of page two, which lists the assessor’s opinion of the property’s market value and the date the appraisal was conducted. Double-check that this number matches the amount on the “Appraised value of subject property” line on page six.
- See why the property is valued the way it is. The second page of the report should list details on three comparable properties, including when they were sold and for how much, as well as their age and condition, and number of bedrooms and bathrooms. The location also matters. Are these comparable homes in similar neighborhoods? A home’s value might change depending on whether it’s in a cul-de-sac or on a busy highway, for example. Do these similar homes and their sale prices align with your home’s appraised value?
- Verify that the property’s address is correct. This should be listed at the top of page one. Is the street name spelled correctly? Is it listed as “Road” when it should be “Drive?” If the appraisal is for a condo or numbered townhouse unit, is the unit number listed as part of the address?
- Read the property description. Study the “Improvement” section at the bottom of page one and make sure that the materials and condition of the included elements (foundation, gutters and downspouts, floors, walls) are correct. See what the appraiser wrote on the “Additional features” line and the “Describe the condition of the property” lines.
- Review the neighborhood description. Also on page one is the “Neighborhood” section. Look at this and be sure that the appraiser wrote an accurate description of the neighborhood and included things that buyers and sellers might value about a home’s location, such as whether it’s walkable to shops and restaurants or if it’s in a particular school district.
What buyers need to know about home appraisals
If you’re looking to buy, an appraisal tells you more than just the valuation of the home; it gives you insight into the condition of the property you want to purchase.
What can you learn from the results of a home appraisal?
While an appraisal is just a visual inspection, it gives a lot of excellent information about a home. It lists any items the appraiser sees that might need repairs, which can help you determine costs you might face after you purchase the home.
The appraisal report also gives details about the property, such as square footage, number of bedrooms and bathrooms, and other amenities.
The comparison to other homes in the area can also give you an idea of the potential for resale. For instance, is the home currently the highest in value in the area? Is it the lowest in value? This information can help you as the buyer determine how much money you want to put into repairing the home or if the value is already maximized. The appraisal can help you decide if the home is priced correctly.
What can happen if you don’t get a home appraisal?
If you’re buying a home, most lenders will require you to get an appraisal. There are some exceptions with conventional loans where an appraisal can be waived, but these cases aren’t common.
An appraisal can also help buyers avoid overpaying for a home. The money it costs to get the estimate can be worth it to know you're paying a fair price.
When do homebuyers and homeowners need to get home appraisals?
The most common use for a home appraisal is to determine how much money a lender will approve for a mortgage, and it’s also used when refinancing a loan. When you apply for a mortgage, the appraisal helps the lender decide if it will approve the loan. The lender wants to be sure it doesn’t lend you more than the property is worth.
What sellers need to know about home appraisals
An appraisal also helps a homeowner assess how much their home is worth. If a home is priced way above the valuation based on comparable properties in the area, it may be difficult to sell.
What does it mean to get a negative home appraisal?
Many things can negatively affect the estimated home value on an appraisal. Some examples include outdated HVAC systems, outdated electrical systems, missing fixtures or appliances, and original windows in an older home.
The main thing to consider is whether the valuation comes in lower than the sale price of the home. In that case, a lender is unlikely to lend the amount needed to get a mortgage on the property.
How can you maximize the results of a home appraisal?
You don’t need to make any major repairs or upgrades before your home is appraised, but there are some quick and easy things you can do to help maximize its value.
- Refresh paint
- Get rid of clutter
- Have a list of any improvements you’ve made to the home
- Create welcoming curb appeal
While these items are not guaranteed to affect the valuation, they can’t hurt either.
How a home appraisal affects your mortgage loan amount
The appraisal affects the amount a lender will approve for a mortgage. Mortgage lenders approve loans based on what the home is worth, not what the seller is asking for it or what a buyer will pay.
The biggest impact on the loan amount happens when the appraisal comes back well below the home’s sale price. It’s not likely that the lender will approve a prospective buyer for a mortgage amount significantly above the appraisal price.
However, if it’s a home you really want, there are other options. Some buyers choose to pay more cash to make up the difference between the home’s value and the purchase price. There are also opportunities to get a second mortgage to cover the difference; it’s important to discuss this option with a financial advisor first.
What can you do if your house appraises for less than the offer?
If an appraisal comes in lower than expected and the mortgage is denied, there are a few things you can do to try to remedy the situation:
- Double-check the appraisal for any mistakes.
- Make sure any improvements to the home are listed.
- As a seller, you can lower the asking price.
- As a buyer, you can offer to pay cash to make up the difference.
You might also consider having a different company complete another appraisal for a second opinion, though this is an added cost.
Whether you’re buying or selling a home, an appraisal is usually a good idea. Not only can it give you an idea of the home's value, but it can also help determine the necessity of updates to the home, find needed repairs and even help prepare for sale at a later date.
Home appraisals FAQ
Who pays for the home appraisal?
Although the lender usually orders an appraisal, the buyer typically pays for the home appraisal as a part of their closing costs.
Can you be present during home appraisal?
There is no law that says you cannot be at home during an appraisal, but it’s best to consult with the assessor coming to your home to know their policy. If you are present during a home appraisal, you can answer any questions the assessor has and point out anything you think might be relevant.
When will you get the results of the home appraisal?
It can take a few days to a week, depending on the appraiser's workload and the complexity of the checklist they are working with to come to a valuation.
How should I prepare for a home appraisal?
Start by looking around your home for any obvious concerns. Anything that is a quick and affordable fix might be worth addressing. You should also make the inspector aware of any improvements you’ve made to the home, such as new windows or granite countertops.
You can also look at the comparable homes sold recently to see if your home lacks anything that might affect the value.
Finally, people often ask if they need to clean their home before an appraisal; while it won’t make a significant difference, it can’t hurt.
How often do you need to get a home appraisal?
Even if you’re not planning to sell anytime soon, you may want to get an appraisal every few years just to see how the local real estate market trends are affecting your home value.
What increases the appraisal value of a home?
Improvements to the home, a desirable location and amenities such as a pool or garden area can increase a home’s appraisal value.
How can you improve your home appraisal?
Take a good look around your home through the eyes of an inspector. Are there any quick fixes you can do that they will notice? This might include things like improving landscaping, fixing a broken board in the fence or repairing a leaky faucet.
If you have time before putting your house on the market, making major improvements is the most likely way to increase the value of your home. This might include getting new windows, upgrading the kitchen or updating a bathroom.
Should I guide the appraiser through the home?
Each appraiser works differently and will let you know what their expectations are. It is important, however, to mention any upgrades or improvements you have made to your home.
How long does home appraisal take?
Depending on the size of the house, the appraisal can take anywhere from an hour to a few days.
When do appraisals happen in the homebuying or selling process?
The appraisal usually happens after an offer has been accepted and after the home inspection. Your lender will probably require a home appraisal before finalizing your mortgage loan.
What hurts a home appraisal?
Some things that can hurt your home appraisal include structural problems, overly customized features, poor curb appeal and unfavorable conditions, such as backing up to a busy street.
How long is a home appraisal valid?
A home appraisal is usually good for about four months, or 120 days. If you do not close on the home within that amount of time, you will need to get another appraisal.
Bottom line: Is a home appraisal worth it?
Take a walk through your home and look at it through the eyes of an inspector.
An appraisal is both an essential and helpful part of buying and selling a home. A lender usually requires an appraisal to make sure the loan amount isn’t higher than what the home is worth. If you’re a buyer, it helps protect you from overpaying for a home. If you’re a seller, an appraisal gives insight into what steps you can take to increase the value of the property.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- Federal Deposit Insurance Corporation, “Understanding Appraisals and Why They Matter.” Accessed Dec. 19, 2025.
- Fannie Mae, “Uniform Residential Appraisal Report.” Accessed Dec. 19, 2025.
