What is a primary function of an appraisal in real estate?

The primary function of an appraisal in real estate is to estimate the market value of a property. This process involves a licensed appraiser assessing various factors, including the property's characteristics, its condition, recent comparable sales, and market trends. The objective is to arrive at an objective valuation that reflects what the property is worth in the current market.

Appraisals are often required for mortgage lending, sales transactions, and taxation assessments. They serve as a critical tool for buyers, sellers, real estate agents, and lenders to make informed decisions based on the fair market value, ensuring that all parties understand the worth of the property in question. Consequently, while providing investment advice, determining pricing strategies, or identifying potential buyers may be important aspects of real estate practice, they do not encompass the primary purpose of an appraisal, which is specifically to ascertain the value of a property.