What Is A Quality Home Appraisal?

Is A Quality Home Appraisal In The Eye Of The Beholder?

Alabaster Home AppraisalHave you heard the phrase “beauty is in the eye of the beholder”? I think that some people may feel the same way about real estate appraisals but that would be a mistake.

Is quality also in the eye of the beholder? Today I would like to talk about what constitutes a quality home appraisal.

While your opinion of what a quality home appraisal is may be different depending on who you are there is really only so many ways to measure appraisal quality. I’m going to discuss what factors of a home appraisal you should be concerned about if your main goal is to get an accurate value estimate.

First off, let’s start with a definition of the word quality. There are two definitions that I believe describe quality in the context of an appraisal. They are:

of or having superior quality, and

producing or providing products or services of high quality or merit

While these two definitions describe the characteristics that a quality appraisal should have they are still somewhat vague. In my 25+ years as a real estate appraiser, I have found that there are two schools of thought regarding quality appraisals which is what we’ll discuss here.

Two Schools Of Thought Regarding Quality

While there are two predominant thoughts on quality I am of the opinion that one of these is more accurate than the other.

There are some who believe that a quality home appraisal is based on two factors: cost and turn around time. A quality home appraisal for them would be one that does not cost much and at the same time, it is completed very quickly.

I have found that the majority of the group that believes in this definition consists of lenders and Appraisal Management Companies (AMC’s). I don’t believe that all banks and AMC’s are like this but in my experience, they are the largest group in this school of thought.

There’s an old saying that states “you can get it good, fast, or cheap, but you can only pick two”. Those who belong in this first group seem to want a home appraisal that is good, fast, and cheap but this is not possible.

This group’s definition of quality suites their needs but it is contradictory to what is required in the appraisal process. There is a general trend in today’s lending environment that everything has to be done at lightning fast speeds.

I have heard that the goal is to make buying a home as fast and easy as buying a car but these two types of transactions are not the same and should not be compared to each other. This is why “cooling off” periods have been put into place so that large decisions like this cannot be rushed and buyers have a chance to make sure this is the right decision.

Just like any other job that requires thorough research and analysis these things take time, and time is money. If you rush through the process things can be overlooked and mistakes can be made.

I have previously written about the steps appraisers take when completing an appraisal assignment (How long does it take to complete an appraisal?) and how long it takes. All appraisals are similar to the steps involved, however, some jobs may vary depending on access to sales data and the amount of market activity.

The second school of thought equates quality with accuracy and completeness. A good quality appraisal is one that reflects accurate information about the subject property, is well developed, and includes thorough support for the opinion of value in the report.

The appraisal value is well supported with the most recent and similar comparables. The sales information has been verified in order to make sure it is accurate so that the value estimate is truly reflective of what is happening in the market.

A quality home appraisal also depends on the education and experience of the person doing the appraisal. Just like in other professions there are appraisers with varying degrees of qualifications. It is important to choose the right appraiser and I have listed the steps you can take to do this in an older post.

Opponents of this perspective may think that an appraisal that comes in below the contract is low quality. This is a short sited attitude, especially if the appraisal was well developed and supported. An appraisal that is inaccurate due to incompetence is another matter altogether and a topic for another day.

An appraisal that is of high quality but may have come in below the contract price is not useless. It can and should be used as a negotiation tool. Appraisals that provide accurate market supporting data can save buyers a lot of money and I’ve written about the steps to take when your appraisal comes in lower than the contract.


So, you have these two schools of thought regarding what constitutes a quality appraisal. As I mentioned previously the definition you believe in will probably depend on what perspective you’re coming from.

Since I am an appraiser I believe that a quality appraisal is one that reflects the market and that is well developed and reported as opposed to one that is done quickly and rubber stamps the contract price.

If you are in need of a home appraisal in the Birmingham area you can rest assured that it will not be rushed. Time will be taken to develop an opinion of value that reflects the real estate market so that your chances of selling it for top dollar in the shortest amount of time will be enhanced.

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  1. Timothy C. Andersen says

    Tom, Thank you! Well said! I remember a time when lending clients would call, thanking us for appraising a property such that it avoided making a “bad” loan. Those days are over. We can’t bring them back. So we soldier on, trying to do the best job we can. Maybe it is time to abandon mortgage lending appraisals, and focus far more on so-called private work. Thanks again! My best to you and all of yours!

    • Thanks, Tim. I keep hearing the same thing about mortgage appraisals. It’s sad but seems to be the direction we are headed. I am diversifying my business to more private work. I know there are some good lenders out there but it seems they are getting harder to find. Hope you have a great 2019.

  2. Nice job as always Tom. On a side note (but related), your post reminds me of this statement: Fast, Good, or Cheap? You Can’t Have All Three. Choose Wisely.

    • Thanks, Ryan. I agree that is a great statement that sums up what I’m talking about. I keep hearing though that many lenders don’t care about the good part they just want it fast and cheap. This is sad because it will take us right back to 2007. Hoping this doesn’t happen though.

  3. Hi Tom,

    Good post. A national reviewer friend told me that the lender was looking for C- appraisals, good enough to get the job done but not any more. Your post captures this well.

    • Wow, Joe, that is very telling. Only looking for C- appraisals? That makes sense when you consider many companies spam every appraiser in the area until they get the lowest fee and turn time. Appraisers should be very careful who they work for considering this mentality.

  4. A Quality Home Appraisal is one done by my company A Quality Appraisal, LLC. We know “quality” because Quality is our middle name. Our focus on quality is customer service, appraiser experience, and complete analysis first. We love to be fast, but we will never sacrifice the other areas to get it.


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