What is a home appraisal and how much does it cost?

It’s no secret that homes tend to be one of the most valuable assets someone owns, but figuring out what a property’s precise value is can be difficult. Home appraisals are conducted by experienced real estate professionals who can help determine the true value of a home and are commonly conducted when buying, selling, or refinancing a property.

If you want to buy a home, your lender will likely order an appraisal to ensure the home is worth enough to secure the loan. You’ll pay for the appraisal as part of your loan’s closing costs, so understanding the process and how much it costs is important if you’re trying to buy a home.

What is a home appraisal?

A home appraisal is a process through which a real estate professional determines the fair market value of a property.

Home appraisals are typically required when you take out a mortgage to purchase or refinance a house. The appraisal can assure you and your lender that the price you’ve agreed to pay for a home is fair.

If you need a mortgage to buy a home, your real estate agent will likely suggest that you include an appraisal contingency in the sales contract. The appraisal contingency lets you walk away from a home purchase if the appraisal comes in too low to justify the agreed-upon purchase price.

Types of house appraisals

All home appraisals help determine the value of a property, but there are a few different ways that an appraiser can conduct the appraisal. Common methods include:

• Hybrid appraisal: A hybrid appraisal combines a virtual and in-person visit. The appraiser will use photographs from the listing or home inspection to view the property. They’ll also hire a local professional to gather additional information on the home, such as room measurements or details on specific features.
• Desktop appraisal: A desktop appraisal is simply done from the appraiser’s computer. The appraiser will use only public records, floor plans of the house, and comparable properties in the area (called real estate comps) to get the information they need.
• Drive-by appraisal: Some lenders may use what’s known as a drive-by appraisal for qualifying borrowers. With this appraisal type, the appraiser examines only the exterior of the property and any available real estate records to determine the home’s value.

Home appraisal vs. home inspection

While most home buyers have both a home appraisal and a home inspection done, it is important to note that they are not the same thing. Both involve having an expert examine the home, but for different reasons.

Where an appraisal is intended to determine the value of a home, inspections are more detailed and intended to identify any potential safety issues, maintenance or repairs required, or other issues with the home.

For example, an inspector will test a home’s appliances, HVAC systems, electrical systems, and more. Appraisers may not even physically visit the home.

How much does an appraisal cost?

The price of an appraisal can vary based on where you live and the property in question. A 2025 study by Angi found that the average cost for an appraisal is $343, but that can rise to as high as $1,000 for multi-family properties.

In general, the more work an appraiser has to do, the more it will cost. That means larger homes and those needing a land survey cost more to appraise. Keep in mind that appraisals are usually paid for by the buyer.

How long does a home appraisal take?

The home appraisal process usually has three steps:

1. Ordering the appraisal
2. Conducting the appraisal
3. Creating a report

It can take days or weeks from the time the appraisal is ordered to the appraiser being available to conduct the appraisal. If the appraiser is physically inspecting the home, it could take a few hours for them to examine the entire property.

After the appraisal is complete, the appraiser generates a report detailing the property and its value. That can take days or weeks, depending on the market, the number of available comps, and the appraiser’s workload.

Home appraisal tips for sellers and refinancers

If you already own your home and want to sell it or refinance it, there are things you can do to help secure a good appraisal. Use these tips.

1. Don’t present a messy property: A property that presents as unkempt may lead an appraiser to believe it hasn’t been maintained in other ways.
2. Fix obvious problems: Appraisers will look for broken fixtures and other obvious issues. Take care of these if your budget permits.
3. Attend the appraisal appointment: If you’re allowed to attend the appraisal, you may be able to point out upgrades or investments that could increase the appraisal.

FAQ

Home appraisals are an important part of the mortgage process, so make sure you understand how they work.

Do I need to get a home appraisal?

If you’re refinancing your home or using a mortgage to finance the purchase of a new home, your lender will likely require you to get an appraisal before you can close on the loan. However, if you’re buying a house with cash, a home appraisal isn’t an absolute necessity.

Keep in mind, though, that it’s still a good idea to get the home appraised so you know you’re paying a fair price for the property.

How long does it take to close after the appraisal is done?

The time it takes to close after a home appraisal is typically determined by several factors, but on average, it can take 1 – 3 weeks. However, it can take over a month at times.

Who pays for the home appraisal?

Unless the home appraisal cost is negotiated with the seller, the buyer typically pays for the appraisal. Factors that can affect the appraisal fee include the home’s location, size, age, condition, and any research the appraiser does on the property.

What can I do if I receive a low appraisal?

If you’re buying a new home and the appraisal comes in low, your mortgage lender won’t lend you more than the appraised amount. You can opt to pay cash to cover the difference between the appraised value and the loan amount, or you can negotiate for a lower sale price or decide not to move forward with the purchase.

If you’re refinancing your home, you may want to challenge the appraisal if you believe the appraiser missed valuable additions or made mistakes on the report.

The bottom line on home appraisals

Whether you’re buying, selling, or refinancing, a home appraisal is likely to be involved. Understanding the process and what you can do to make sure the appraisal comes back at a value that works for you is key to helping the closing go smoothly.

If you’re ready to start your homebuying journey, you can start an application with Rocket Mortgage^® today.