What Is a Real Estate Appraiser?

A real estate appraiser assesses property values, often in advance of a change in ownership. Most appraisers specialize in either residential or commercial properties. In both cases, their work involves buildings and vacant or unimproved land.

Estate appraisers focus on a single property when carrying out their duties. They conduct site visits, noting both the general and unique features of the property. Real estate appraisers then compare these features against similar properties. Their analysis yields an accurate estimate of the property's current market value.

Local governments often hire appraisers to conduct property assessments for taxation purposes. Others work independently, or for real estate agencies or brokerages. These professionals carry out assessments for clients looking to sell or buy a home.

This guide offers a detailed answer to the question "What is a real estate appraiser?" It explains key skills, specializations, and how to become an appraiser of real estate. We also include an outlook on the profession's labor market demand and earning potential.

What Does a Real Estate Appraiser Do?

Estate appraisers conduct neutral and independent assessments of a property's value. These assessments often precede the property's listing or sale. Other organizations like local governments, insurance companies, banks, and real estate agencies also arrange appraisals. In these situations, the purpose of the appraisal may include:

• Assessing property value for tax purposes
• Conducting an assessment as part of an insurance claim
• Preparing the property for development or redevelopment
• Due diligence ahead of an enterprise merger or acquisition

Specific tasks for carrying out these duties include:

• Visiting Site: Appraisers of real estate conduct thorough in-person inspections as part of their valuation analyses. This process often includes taking photographs or otherwise documenting key features.
• Analyzing Data: Evaluation involves making detailed comparisons of similar properties. Appraisers collect, verify, and interpret all relevant data that could affect a property's valuation.
• Following Market Trends: Local and regional real estate market trends impact a property's value. Estate appraisers must stay current on trends and understand how those trends might affect property.
• Updating Property Records: Appraisers sometimes interact with property records, both private and public. They note and transcribe property features, including any tangible changes that may impact its value.
• Writing Reports: Appraisers sometimes orally present their findings. However, clients and employers often require detailed written reports.

Key Hard Skills for Real Estate Appraisers

• Financial Numeracy: Appraisers must compile lots of numeric data and carry out complex calculations. These can include determining square footages, converting units of measure, and establishing long-term price trends.
• Writing: Sometimes, appraisers verbally report their findings. In other cases, they must prepare detailed written reports that demand polished, professional presentation.
• Advanced Real Estate Knowledge: Given the consultant nature of the job, appraisers need thorough knowledge of the real estate sales process. They benefit from a detailed understanding of real estate and property tax law.
• Recordkeeping: Appraisers sometimes update public property records and create new records for internal use. Knowledge of recordkeeping best practices is essential.

Key Soft Skills for Real Estate Appraisers

• Verbal Communication: Appraisers need to explain their findings and process in clear language. As such, they need strong and well-developed verbal communication skills.
• Customer Service: Appraisers interact with many different people. Knowing how to provide timely and courteous service can make this aspect of their job run more smoothly.
• Time Management: Appraisers and assessors sometimes work within tight time constraints. For instance, a property owner may need an appraisal performed quickly as they prepare to respond to a potential buyer's offer.
• Critical Thinking: Sometimes, the numbers and data involved in a particular valuation may not add up like expected. Thus, appraisers require the ability to scrutinize and apply deductive reasoning to their own work.

Appraiser of Real Estate Areas of Expertise

Many appraisers of real estate develop focused expertise in a particular aspect of professional practice. For instance, some specialize in residential property while others concentrate on commercial developments.

The following specializations are common:

Residential Real Estate Appraiser

Residential real estate appraisers deal with detached and semi-detached homes, condominiums, townhouses, and vacant lots zoned for residential development. They focus on generating an impartial and accurate estimate of the property's current market value.

In the case of unimproved land, appraisers may also offer opinions on the property's future value following planned development. For example, a client may ask an appraiser to estimate what a vacant lot's value would be if a newly built home were added.

Some residential appraisers hold permanent, full-time positions. Others work as contractors, accepting appraisal work on the side while holding a full-time job.

Common Job Titles

• Residential property valuation specialist
• Land appraiser
• Home appraiser
• Valuation surveyor

Commercial Real Estate Appraiser

The main difference between commercial appraisers and residential appraisers is their focus. Commercial appraisals involve intricate data collection, verification, and analysis specific to each property's unique features.

Relative to residential appraisals, commercial property analysis often involves more points of comparison. Thus, it can be more complex and time-consuming.

Real estate appraisers often conduct residential appraisals for tax assessment or due diligence ahead of a property transaction. These also apply to commercial appraisals. However, clients and organizations can order commercial appraisals for:

Mergers and acquisitions
Asset division
Litigation
Feasibility studies

Common Job Titles

• CRE appraiser
• Commercial property valuer or valuation specialist
• Valuation surveyor

Assessor

Real estate assessors tend to work for local governments. Like appraisers, their primary goal is estimating the value of specific properties. Assessors focus on multiple properties simultaneously. Their work can cover:

Clusters of high-density development
Business or industrial parks
Sections of streets
Entire streets or neighborhoods
Entire residential, commercial, or industrial districts

Assessors often perform their duties as part of a wider municipal tax assessment. Their work has a direct impact on the taxes individual property owners pay. Owners reserve the right to challenge property tax assessments. As such, assessors sometimes need to defend their findings in court.

Common Job Titles

Property tax assessor
Real property assessor
Residential property assessor
Commercial property assessor
Industrial property assessor

How to Become a Real Estate Appraiser

Most U.S. states require certain appraisers of real estate to hold licenses. Licensure verifies the professional possesses a set of standard, essential skills.

In many cases, hard licensure mandates apply only to appraisers who value properties on behalf of financial institutions. However, holding a license even when not required inspires the confidence of clients and employers.

State-level licensure requirements vary, but often include:

• A bachelor's degree
• Professional experience acquired through on-the-job training
• A passing grade on a standardized certification examination

Licensing authorities may be able to direct aspiring appraisers to reputable training programs and learning resources.

How Much Do Real Estate Appraisers Make?

The U.S. Bureau of Labor Statistics (BLS) includes real estate appraisal in its entry for "property appraisers and assessors." According to BLS data from May 2021, appraisers and assessors earned median pay of $61,340 per year. The BLS also projects 4% growth in demand for appraisers and assessors from 2020-2030.

Payscale data suggests licensure may have a strong and positive impact on an appraiser's earning potential. In April 2022, Payscale listed the average base salary of a state-certified real estate appraiser at $74,000 per year. This represents a premium of more than 26% on the generalized median income data reported by the BLS.

Questions About the Real Estate Appraiser Job Description

What does an appraiser do?

An appraiser performs a complete and detailed analysis of a property to determine its market value. Appraisers conduct site visits and document property features, comparing them against similar properties.

What specializations can real estate appraisers have?

Real estate appraisers tend to specialize in either residential or commercial real estate. Another specialization applies to property assessors. These professionals perform valuations of many properties at the same time, usually for tax assessment purposes.

Where does a real estate appraiser work?

Appraisers work in several settings including government agencies, insurance companies, banks, and real estate agencies or brokerages. Many also function as self-employed contractors.

What does an appraiser look for in a house?

Appraisers evaluate every tangible aspect of a building when conducting a valuation assessment. Specific points of analysis include size, age, style, and lot characteristics. Appraisers may also look at vehicle access, utility connections, and whether the property has desirable features.

How does an appraiser differ from an accountant?

The two professions focus on entirely different duties. An appraiser performs site-specific, data-based property evaluations to determine their market value. An accountant tracks and records financial transactions on behalf of a client or company.

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