Appraiser vs. Home Inspector – What’s the Diff?

Often before a property is purchased using a loan from a mortgage company, it must be appraised and inspected. Many homeowners confuse the appraisal inspection and the home inspection and ask me what the difference is. Here are some of the main ways that appraisals and home inspections are different and also overlap.

Different End Goals: Value vs. Condition

The main thing to know is a real estate appraiser’s focus is on determining the value of the home and those factors that will influence that value. A Home Inspector’s main objective is determining the condition. The Home Inspector is tasked with determining the condition of the property in terms of structural soundness and quality/safety of electrical and plumbing systems. The Home Inspector has an obligation to be accurate in their assessment of a home’s condition but they also act as advocates for the buyer. Their job is to point out any deficiencies with the house such as outdated/unsafe wiring or obvious problems with the foundation so that their client (the buyer) can make an informed decision about whether to purchase the house, negotiate a lower contract price, or just walk away all together. See the graphic below for many of the items a home inspector will be looking at (Source: www.gqre.com).

While an appraiser’s inspection of the property may take into consideration many of the things a Home Inspector looks at, his/her ultimate goal is to provide an opinion of value. The appraiser’s job is to provide their client (the lender) an accurate, well-supported, unbiased opinion of value. This usually includes commentary on the condition of the property since that is tied to value. For example, a 1960’s ranch home in original condition will most likely have a lower value than a 1960’s ranch home in the same neighborhood that has an updated kitchen and bathrooms. The appraiser’s job is to give the bank their opinion of market value (I go into this in more detail on a prior post - Market Value: Probable vs. Possible) which helps them determine if the mortgage be a good, sound investment for the bank.

Appraisal Inspection vs. Home Inspection

So how will you tell the Appraiser and the Home Inspector apart when they come to your home? Probably they’ll introduce themselves as either the Appraiser or the Home Inspector. Just kidding!

The appraiser’s site visit will usually take around 30 minutes and they will measure your house and look at all of the rooms including the basement. They will be noting the quality and condition of the finishes, the layout, bed and bath count, etc. They will take pictures of each room to include in the appraisal report. In some cases, like for an FHA loan, the appraiser may inspect crawl spaces and attics or test the basic appliances. But he’s probably not going to crawl under the house to inspect the foundation or get on your roof and walk around looking for leaks.

Appraisers try to look at the property through the eyes of the most probable buyer for that particular property – not only which features and attributes they find desirable, but also to what extent would the typical buyers be “inspecting” the home? A more simplified way to look at it is to ask yourself: “If I were looking to purchase this house, what are the things I would look at and what things would I hire someone with professional experience to check?” You may open a cabinet or two, look at the ceilings for leaks, take a look at the mechanicals to see if they are newer or may need replaced soon. But in my experience, very few buyers will be going into crawl spaces and bringing their ladders to get on the roof. They are mainly interested in the functionality of the house such as how many bedroom and bathrooms, whether they like the layout of the floorplan, etc.  Here is a great video from a Portland appraiser, Gary Kristensen, that shows you what you can expect when an appraiser visits.

A Home Inspector will really get into the bones of the home. They will get on the roof, get into the crawl space, and analyze the structural integrity. A good Home Inspector will be able to find possible issues that the Appraiser may not such as termites, faulty electrical wiring, plumbing that is not up to code, structural issues, leaky roof, mold, etc. Now that I’ve scared you with all the things that could be wrong with a house you’re looking to purchase (!), I highly recommend that if you are buying a home you hire a licensed Home Inspector to complete a full home inspection because they will be able to tell you things about the home that the typical appraiser is not going to. If you don’t know a good home inspector in Chicagoland, we recommend Inspectrum. Click here for their website and contact info.


If you have any questions, please don't hesitate to call us at (847) 863-5776. We specialize in appraisals for estates, divorce, pre-listings, bankruptcy, etc.

Real Estate Agent Property Questionnaire

I love when I have the opportunity to meet the listing agent at the property, but as you know, that’s not always possible. This fillable/interactive form allows you to make sure the appraiser has all of the information they need to complete a thorough appraisal of your listing. I’ve broken this form up into two sections with the first covering the recent updates to the property and the second related more to the market area and ways in which your listing shines. Each section/question is designed to help you communicate pertinent information to the appraiser that will be helpful is the appraiser determining the most accurate opinion of value.


Section 1 (Improvement/Updates)

By completing this section, you can make sure the appraiser knows about updates and improvements made to the property as well as their approximate cost. Obtaining the approximate cost of the improvements can be helpful in supporting a significant increase in value if the home had recently sold prior to these updates. While cost does not always equal value, knowing the cost of improvements assists the appraiser when analyzing the contributory value of each improvement. These updates are broken up into 5 year increments as this is how appraisers are now required to report the updates to the kitchen and baths in the appraisal report.

Section 2 (Market Information)

Here is your opportunity to provide the sales/listings you used to determine the list price -- essentially potential comps for the appraiser to consider. You can also address in the 2nd question major selling points. A good appraiser should already know certain benefits of a property’s location but you, as Realtors, often have more detailed or nuanced information about what prospective buyers are looking for. Think of what is most discussed or brought up by potential buyers when you are showing the house. Was it the large master bedroom suite, walking distance to the Metra or Blue line, proximity to downtown’s shops and restaurants, the best school district in the area? All of this is great information for an appraiser to have.

Multiple Offers and Additional Info

More specific questions, such as the one about multiple offers, may ultimately help the appraiser support an opinion of value that takes into account current market demand that may not be reflected yet in recent sales prices (possibly an indicator that values are increasing). Lastly, there is an area for anything else you want the appraiser to know.


Property Questionnaire

for Real Estate Agents


Questionnaire for Homeowners

We also do a ton of “non-lender” work, so I also created a modified version of this form to give to homeowners who call me directly for appraisals for divorce, pre-listings, estates, etc. Click below for a copy of this modified version to help you ascertain the recent improvements when putting the MLS listing together and pricing the property.

Property Questionnaire for Real Estate Agents

A couple of days ago I was sitting down to start writing a blog post on how to streamline the initial appraisal process, specifically gathering information on the subject property prior to doing the inspection. Over the weekend I listened to an episode of the podcast “Voice of Appraisal” where Phil Crawford mentioned an improvement worksheet that the Ohio Coalition of Appraisal Professionals (OCAP) has distributed to local area realtors. I recently contacted him and Steve Papin, the president of OCAP, who was kind enough to send me a copy. Here is the PDF (Property Questionnaire), or you can email me and I can send you the Word Doc that is formatted properly).

The main purpose of the questionnaire is to gather information that might otherwise be difficult to obtain. As you can see, the form provides the listing agent an opportunity to list all recent updates and any other details they would want an appraiser to know. Instead of springing all these questions on the agent at the time of the  inspection, by emailing a copy in advance they can have the time to do any necessary research and talk to their clients about the property before you even go there. And since it’s fairly often that a property is on a lock-box, you may not even meet the Realtor. Finally, at the end of the day you’ll have a document that can easily be saved to your work file.

In doing more research on these types of questionnaires, I saw that Ryan Lundquist of Sacramento Appraisal Blog, has also shared a “cheat sheet” that you can download here. This morning I was all set to wrap up my blog post by outlining even more benefits to these forms when I saw that Tom Horn, appraiser and author of the Birmingham Appraisal Blog, posted his own version of the “Property Questionnaire” here. So, clearly something is in the air folks! Tom’s blog post, as always, is top notch and has lots of good tips and suggestions for agents and homeowners alike.

I will most likely be creating my own form based on these three examples to include a section for any other additional features that the agent feels adds value to the property, or specific neighborhood info that the agent thinks is important. I suggest you do the same. Choose your own adventure or tailor one of these questionnaires to fit the Real Estate Agents in your own market! Once I’ve gotten mine whipped into shape, I’ll post it to my blog.

How to Prepare For a Real Estate Appraisal Inspection

If you haven’t had an appraisal completed on your home recently, one of the first things that may come to your mind is, “What do I need to get ready for this?”.  Here are some helpful things you can do prior to the appraiser coming to your home.


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