Despite the benefits of hiring a professional real estate appraiser, it’s not an absolute requirement if you’re simply looking to sell your home. A real estate agent can provide a market analysis, which entails their completing price research on recently sold or currently for-sale comps in nearby neighborhoods. An agent may or may not have knowledge about the local markets they serve, and typically many agents provide a market analysis for little or no cost. It’s important to remember this approach is also the opinion of the real estate agent and current for sale comps remain the dream price sellers would like to obtain when selling their home since the home has not actually sold. To get the most accurate sales price for a property a seller should hire a professional appraiser.
All appraisers must carry licenses and certification. The Appraisal Institute is the body that authenticates appraisers across the globe, and officially gives experienced members designations (MAI, for example) that recognize their experience and professionalism and are respected by courts, agencies and corporations as such.
There are situations, however, in which an independent real estate appraiser is necessary. If a home is brand new and requires the cost approach, it’ll need a dedicated appraiser. You’ll also need an independent appraiser for other purposes related to home valuation: settling mortgages, insurance, tax evaluations, estate planning or legal proceedings.
Most homebuyers have almost no leeway in choosing an appraiser, especially if they’ll need a loan. Most sales home appraisals are actually overseen by lending companies, who maintain lists of local appraisers, or appraisal management companies, that they employ on a regular basis. The relationship between the two is particularly close-knit, as lenders use appraisal data to ensure their loans are appropriate.
Even though the home buyer bears the cost of the appraisal at closing, the lenders will almost always rely on the judgment of the appraisers they’ve approved. So, in that case, the choice of an appraiser is out of the buyer’s hands, unless they want a second opinion for their own reasons (and out of their own pocket).