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

The primary purpose of an appraisal in real estate is to provide a value estimate for a property. This process involves evaluating various factors, including the property's condition, location, surrounding market conditions, and comparable sales data. The appraisal results in a professional opinion of the property's fair market value, which is crucial for informing buyers, sellers, lenders, and other stakeholders in a real estate transaction.

While determining market price, establishing tax assessments, and analyzing the neighborhood are aspects that can be influenced by an appraisal, none of these represent the core objective. The appraisal serves as an objective measure of value and is often required in transactions for securing financing or ensuring that buyers are making informed decisions. Thus, the valuation is not only fundamental to the transaction at hand but also vital for supporting broader market integrity.