What is the main purpose of an appraisal in real estate transactions?

The primary purpose of an appraisal in real estate transactions is to determine the market value of the property. An appraisal is a professional assessment conducted by a qualified appraiser, who analyzes various factors such as location, property condition, comparable sales, and market trends to arrive at a fair market value. This value helps both buyers and sellers make informed decisions and is often required by lenders before approving a mortgage or loan.

While establishing a selling price may be a secondary outcome of knowing the appraised value, it is not the main purpose of the appraisal itself. Similarly, evaluating the condition of the property and assessing environmental concerns are important aspects of property assessments, but they serve different purposes and are not the focus of the appraisal process. The central role of an appraisal is to provide an unbiased estimate of what a property is worth in the current market, ensuring that all parties involved can rely on accurate and standardized valuation information.