An appraisal is an independent licensed opinion of what a property is worth on a stated date, written for the lender that ordered it, and built mostly by comparing the home to recent sales of similar homes nearby.
Three things in that sentence do the work. It is an opinion, formed to a professional standard rather than measured off an instrument. It is tied to a date, so a value from March says nothing about September. And it belongs to the lender, even though the buyer usually pays for it.
The lender's question is narrow: if this loan goes bad and the home has to be sold, what is the collateral worth. That framing explains almost everything people find strange about appraisals, including why a clean kitchen does not help and why the appraiser will not tell you whether the house is a good buy.
Who orders it, who pays, and who it is for
On a financed purchase the lender orders the appraisal, almost always through an appraisal management company, because federal appraiser independence rules keep loan production staff out of the selection. The buyer pays the fee as a cost of getting the loan, by card when the order goes out or as a line at closing. The appraiser works to the standards their license is held to, not to the interests of whoever paid.
The buyer does get the report. On any loan secured by a first lien on a dwelling, the lender has to give the applicant a copy of every appraisal and written valuation promptly on completion and no later than three business days before closing, at no charge for the copy itself. Keep it: it holds the measurements, the condition rating and the comparable sales the next appraiser on this house will be working alongside.
A cash buyer has no lender and so no appraisal unless they order one, and a report a seller or an executor ordered is not usable by a lender, because it was addressed to somebody else.
The sales comparison approach
Residential appraisals are built by comparison. The appraiser selects three to six closed sales, usually from the last three to six months and within a mile in a suburban market, then adjusts each for the differences: more square footage, an extra bathroom, a third garage bay, a pool, a busier street. The adjustment is applied to the comparable rather than to the subject, which is the part people reverse.
The adjusted prices bracket the subject property, and the appraiser reconciles them into one number with reasoning attached. Active listings and pending sales appear as support for the market's direction, not as evidence of value, because an asking price is a hope and a closed price is a fact.
Two other approaches exist and are rarely decisive on a house: the cost approach, which prices a rebuild less depreciation plus the land, and the income approach, which values a property off the rent it produces.
Not the assessor's value, and not an automated estimate
The county assessor produces a taxable value on a mass-appraisal schedule for the whole roll, on its own calendar and under its own statutory rules. In Nevada that figure is built from a land value plus a replacement cost less depreciation, and the tax is charged against a fraction of it. It is not an opinion of market value, which is why a parcel record showing a taxable value well below the price does not mean the price is wrong.
An automated estimate is a model reading public and listing data across thousands of homes at once. It is fast and free, and it cannot see inside a house, tell a renovated kitchen from an original one, or know that the comparable it leaned on was a distressed sale. Lenders do use automated values, but to decide whether a full appraisal is needed rather than as one.
So three numbers on the same house can differ by a lot without any being wrong. They answer three different questions on three different dates.
When a purchase needs one, and when it does not
Most financed purchases get a full interior appraisal. A meaningful share of conventional loans do not: the automated underwriting accepts the lender's own value, sometimes after a property data collection visit, and no appraisal fee is charged. Desktop and hybrid appraisals sit in between, with the analysis done from records and someone else's photographs.
None of that is the buyer's choice; the loan program and the underwriting response decide. What the buyer does control is the appraisal contingency, the clause that turns a low value into a decision rather than a default, and it has a deadline printed on the form.
Questions people ask
How long does an appraisal take?
The visit is commonly twenty minutes to an hour for a typical single-family home, and the report follows a few days to two weeks later depending on how busy appraisers are locally. The wait is the scheduling and the report, not the visit.
Is an appraisal the same as a home inspection?
No. The appraisal is ordered by the lender, is about value, and tests nothing. The inspection is ordered by the buyer, is about condition, and reports defects that may have no effect at all on the appraised value. They are separate purchases with separate purposes.
Can an appraisal be wrong?
It can be, since the report is an opinion rather than a measurement. The route when it looks wrong is a reconsideration of value through the lender, naming closed sales the report missed or an error in the square footage or room count.