What does the monetary amount provided by an appraiser represent?

The monetary amount provided by an appraiser represents the value of a property, which is an estimate based on various factors, including market conditions, property characteristics, and comparable sales data. Value is determined through analysis and is not necessarily tied to what a buyer is willing to pay or the cost incurred to build or improve the property.

When an appraiser assesses a property, they consider its potential selling price in a competitive market, which can differ from the market price, the actual price at which a property sold, or the cost basis, which is the original value of the property adjusted for improvements or depreciation. An investment return pertains more to the yield on an investment rather than the property’s assessed value. Therefore, the primary focus of an appraisal is to establish the value, which can be used for various purposes such as financing, insurance, or taxation.