by Kyle & Jennifer Coover 
If you’re buying or selling a home, chances are you’ll encounter a home appraisal during the process. It’s a critical step in most real estate transactions—but many people aren’t quite sure what it involves or how it can impact the sale. Whether you’re a first-time homebuyer or preparing to list your property, here’s what you need to know.
What Is a Home Appraisal?
A home appraisal is a professional, unbiased estimate of a property’s market value, conducted by a licensed appraiser. The appraisal is typically required by a mortgage lender to ensure the home is worth the amount the buyer is borrowing.
It protects the lender from over-loaning and gives both the buyer and seller a clearer picture of the home’s fair market value based on current conditions.
What’s the Purpose of an Appraisal?
The appraisal helps answer an essential question:
Is the home worth the agreed-upon purchase price?
Here’s why appraisals are so important:
- For Buyers: It ensures you’re not overpaying.
- For Sellers: It confirms the price you’ve set is reasonable.
- For Lenders: It justifies the loan amount being issued.
If the appraised value comes in at or above the purchase price, the sale typically moves forward. If it comes in below, it can delay or even derail the deal unless the parties can renegotiate.
What to Expect During the Appraisal Process
Appraisals are usually ordered by the buyer’s lender shortly after the home goes under contract. Here’s what happens:
- The Appraiser Visits the Property
They’ll assess the home’s condition, size, layout, features, improvements, and any potential issues. - Market Research & Comparable Sales
The appraiser compares the home to similar properties that have recently sold in the area—also known as comps. - The Appraisal Report
A detailed report is compiled that includes the estimated market value, photos, neighborhood data, and supporting comparable sales.
This entire process typically takes a few days to a week, depending on the location and the appraiser’s availability.
How Appraisals Impact the Sale
Appraisal outcomes can directly affect the transaction:
- Appraised Value Matches or Exceeds Sale Price:
Everything proceeds as planned. - Appraised Value Is Lower Than Sale Price:
This could trigger:- A price reduction by the seller
- A larger down payment from the buyer
- The buyer and seller renegotiating terms
- In some cases, the deal falling through
In competitive markets, appraisal gaps are not uncommon, and buyers may even waive appraisal contingencies or offer to cover part of a shortfall to strengthen their offer.
Tips to Prepare for an Appraisal
If you’re a seller, here are a few ways to help your appraisal go smoothly:
- Make sure your home is clean and well-maintained
- Provide a list of recent upgrades or improvements
- Highlight unique features or energy-efficient additions
- Ensure easy access to all areas of the home
As a buyer, it helps to:
- Understand the market and recent sales in the area
- Be ready to respond if the appraisal comes in low
Final Thoughts
Appraisals may feel like just another step in a long process, but they play a key role in keeping real estate transactions fair and grounded in reality. Understanding how they work can help you avoid surprises and move confidently through your purchase or sale.
Have more questions about appraisals or the home selling process? Contact us today—we’re here to help guide you every step of the way.
Call or text us: 570-872-7123
