Understand what an appraiser does, what an appraiser is, and how you can negotiate so an appraisal is in your favor.

The home appraisal is an assessment of value of real property, and is done by a licensed appraiser. While many people see it as a daunting step in buying a home, knowing the ins-and-outs and who's-and-what's will give you enough ammunition to understand an appraisal and use the valuation to your benefit. If you are looking browsing Treasure Coast homes and looking for a good local appraiser, send us a contact email.

What is an Appraisal and Why do I need one?

Let's say you are looking for homes for sale in Stuart, make an offer, and it is accepted. Before your lender will approve your loan, the property that is being purchased or refinanced must pass an appraisal to ensure it is valued at or above the amount of the loan. As stated above, an appraiser is a third-party hired to provide a statement of value for any piece of real estate. This way, the bank is not immediately underwater if a home buyer were to take out a mortgage and immediately default. This is not to be confused with the home inspection that will be done earlier in the home-buying process.

Appraisal House

Who Chooses and Pays for the Appraiser?

It is important to remember that appraisers do not represent any party in the transaction, they are an objective third-party entity who are contracted by your lender through an appraisal management company that maintains a database of trusted, licensed appraisers. Neither you, your real estate agent, your lender, or your title company have any say in which appraiser is chosen. This is important because federal guidelines stipulate that anyone with interest in the value of a piece of real estate cannot be involved in the appraisal process. The appraisal is typically paid for by the borrower of the loan, or the buyer of real estate, however this can be negotiated in the purchase contract. 

What Do Appraisers Look For?

When an appraiser is valuing a piece of real estate, they will compare it to properties that have recently sold in the area based on the following criteria: proximity, time of sale, age, condition, and size. If you homes in Port St. Lucie will not be used as comparable sale for condos in Palm City, and a home that sold yesterday will be a better comparable sale than one that sold five years ago. 

When an appraiser is coming up with a nonpartisan valuation, they take everything into account from the condition of the exterior and interior to the size and location of the home. They also include any home improvements and additions that may be advantageous compared to comparable sales. 

How Much Does an Appraisal Cost?

The national average cost for an appraisal is $333, according to HomeAdvisor.com. The typical range is between $310 and $404, with the low end around $250 and topping out near $450.

What Do I Do After I Get my Appraisal Report?

When your appraiser sends your lender the appraisal, there will be three possible outcomes.

  1. The appraised value meets the purchase price.
  2. The appraised value is below the purchase price. 
  3. The appraised value is above the purchase price. 

If the appraisal is higher than the purchase price, then you have essentially purchased a home with immediate equity in the property. If the appraisal comes in lower than the purchase price, the lender will not supply the loan. In this instance, the buyer and seller of the real estate would usually renegotiate terms in the contract to move forward with the sale.


If you have any other questions about real estate appraisals that were not covered here, send us your questions. Remember, you can always view homes for sale all over the Treasure Coast on our website, in real time, straight from the MLS!