A house appraisal plays a vital role in the home buying process. It protects the lender by confirming the home’s value and helps buyers avoid overpaying. A low appraisal can delay—or even cancel—a real estate deal, so it’s important to know how the process works.
What Is a House Appraisal?
An appraisal is a professional assessment of a property’s fair market value, conducted by a licensed appraiser. It’s different from a real estate agent’s valuation because it’s required by lenders to approve a mortgage.
What Appraisers Look For
Appraisers examine the home’s condition, layout, size, and features—inside and out. They consider:
- Square footage and lot size
- Renovations and upgrades
- Roof, HVAC, plumbing, and electrical systems
- Storage, room count, and functionality
- Curb appeal and landscaping
They also compare the home to recently sold properties nearby (comps) and factor in location—like proximity to schools, amenities, public transportation, and neighborhood safety.
How the Appraisal Process Works
Once a home is under contract, the lender orders an appraisal. The appraiser visits the property, researches market data, and delivers a report with their value estimate, usually within a few days.
What Lowers an Appraisal
A low appraisal can result from:
- Recent nearby sales at lower prices
- Outdated or poorly maintained features
- Unfavorable location or market conditions
- Unusual layouts or lack of buyer-demanded features
What Raises an Appraisal
Homes tend to appraise higher if they:
- Are well-maintained and updated
- Sit in desirable locations with good schools
- Have strong comparable sales
- Offer modern layouts and energy-efficient features
If the Appraisal Comes In Low
If the value is below the agreed price, buyers may:
- Renegotiate the price
- Pay the difference in cash
- Cancel the deal using an appraisal contingency
Can You Dispute an Appraisal?
Yes, you can challenge it with better comparables or missing details. You can also request a second appraisal, though lenders aren’t required to accept it.
How Long Does an Appraisal Last?
Most appraisals are valid for about four months, though this can vary by lender and loan type. A new appraisal may be needed if the market changes or the property is altered.
Final Thoughts
A home appraisal ensures fair value for both buyers and lenders. By understanding the process and what affects property value, you’ll be better equipped to navigate the real estate journey confidently—whether you’re buying or selling.