What are the Differences between a Home Evaluation and Appraisal

December 16, 2019

, , , , , , , , , , ,

Whether you are in the market to buy or sell a home, it is important to have a good understanding of the service options and insights available to you as you prepare for your next move.

Adopting an active “buyer”, or “seller”, attitude at the outset will serve you well throughout the process.

I strongly suggest you take some time to learn about the market and neighbourhood you’re in or looking at, and also your financial situation before looking for a sales person or brokerage to assist you.

Educating yourself will help point you in the right direction when it comes to deciding on a real estate representative.

A big piece if the puzzle is knowing which tools an agent can offer when it comes to representing your best interested and addressing your lifestyle goals, concerns and any sensitivities you may have.

Appraisals and evaluations/analyses are two very distinct services that some salespersons or brokerages bring to the table.

I would like to highlight that neither is required in the sale or purchase of a property.

When discussing a market evaluation or analysis you can expect to be provided a cross-comparison of similar properties that have been sold, or listings that are active and expired, within a specified area.

Remember, these properties offered for evaluations will be complied without recognition of specific renovations and upgrades or major repairs that impact a sale.

But it can give you a good idea of the general make-up of a neighbourhood and provide a baseline comparison the properties in it.

Keep in mind that properties similar in size, bedrooms and washrooms do not always mean you’re looking at an apple-to-apple comparison. For this reason, when reviewing a report, dig deeper into any anomalies that seem to skew the overall picture.

These reports are valuable for both buyers and sellers – buyers by helping them to determine generally what they’ll pay for a property and sellers by by helping them set a realistic asking price that reflects the immediate market.

A real estate appraisal, on the other hand, will provide information related to features and the condition of a specific address. Factors in an appraisal report – such as the square footage of the structure, its overall condition, the number of bathroom and bedrooms and things such as an inclusion of a of a pool or fireplace – will provide an assessment for financial lenders.

It may also serve as an additional tool for potential buyers regarding a property’s value. It is important to note that an appraisal can only be prepared by someone who is accredited to prepare one.


Reprinted from The Toronto Star, Sat., Dec. 14, 2019
Joe Richer is registrar of the Real Estate council of Ontario (RECO) and contributor for the Star.