What is one of the main purposes of property appraisal?

One of the main purposes of property appraisal is to assess the current market value for transactions. Appraisals provide a professional and objective assessment of a property's worth, which is critical during real estate transactions, such as buying, selling, or refinancing. This valuation is based on various factors, including the property’s condition, location, size, and recent comparable sales in the area, ensuring that all parties involved in a transaction have a clear understanding of the fair market value.

Understanding the current market value is essential for both buyers and sellers, as it helps in negotiating prices and making informed decisions. Appraisals are often required by lenders before approving a mortgage to ensure that the amount financed does not exceed the true value of the property, promoting responsible lending practices. By establishing this market value, appraisals serve as a foundational tool in the real estate industry, facilitating smooth transactions and protecting the interests of all parties involved.