What Does a Real Estate Appraiser Actually Do? Everything You Need to Know in 2025

Laura Cade
May 14
3 min read

Demystifying the Role of an Appraiser

If you’ve ever bought, sold, refinanced, or inherited property, chances are you've heard the term "real estate appraiser."

But what does an appraiser really do? How do they determine what your property is worth? And why do banks, courts, and investors put so much trust in their opinion?

In a changing 2025 market filled with rising rates, economic uncertainty, and AI tools, the role of the appraiser is more relevant than ever. This article breaks down the purpose, process, tools, and importance of modern real estate appraisals.

1. What Is a Real Estate Appraiser?

A real estate appraiser is a licensed professional trained to estimate the market value of real property. This includes residential homes, commercial buildings, agricultural land, and development sites.

They are independent, unbiased, and governed by national and provincial standards such as CUSPAP (Canada) or USPAP (United States).

Their job is to provide a defensible opinion of value that others—especially lenders and legal parties—can rely on.

2. Why Are Appraisals Needed?

Appraisals are critical for:

Mortgage financing
Estate settlements
Divorce proceedings
Tax assessments
Insurance claims
Litigation and court proceedings
Property investment analysis

Without an independent valuation, decisions involving real estate would rely on guesswork or biased parties.

3. How Appraisers Determine Property Value

Appraisers use three approaches to estimate value:

Direct Comparison Approach: Compares the subject property to similar recently sold properties.
Cost Approach: Calculates the cost to replace the structure minus depreciation, plus land value.
Income Approach: Used for rental and commercial properties, based on income generation potential.

They also factor in:

Market trends
Location
Condition and quality of construction
Legal use and zoning
Supply and demand in the area

4. What Happens During an Appraisal?

The appraiser will:

Inspect the property (physically or virtually)
Measure square footage
Note upgrades, damage, or deficiencies
Analyze comparable sales data
Consider market conditions
Write a full report with analysis, adjustments, and value conclusion

Modern appraisals use software, digital maps, GIS tools, and MLS data to support conclusions. In some cases, aerial drone footage and AI modeling assist in data collection.

5. Common Misconceptions About Appraisers

They set the price – No, appraisers reflect market conditions.
They work for the buyer/seller – Usually, they are hired by lenders or third parties.
They always come in low – Appraisers aim for accuracy, not inflation or deflation.
They don’t go inside – For full inspections, interior access is standard.

6. How Long Is an Appraisal Valid?

Most appraisal reports are valid for 90 to 120 days, depending on lender requirements. However, in rapidly shifting markets, values may become outdated more quickly.

7. Who Regulates Appraisers in Canada?

In Canada, appraisers must be members of organizations such as:

Appraisal Institute of Canada (AIC)
Real Estate Institute of Canada (REIC)

They are required to follow the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP) and maintain ongoing education.

8. When Should You Hire an Independent Appraiser?

Consider hiring an appraiser when:

You disagree with a tax assessment
You're settling an estate or divorce
You want to verify value before listing
You're buying an investment property
A lender requires one for refinancing

Appraisals can save thousands by preventing overpricing or underpricing.

9. How Much Does an Appraisal Cost in 2025?

Typical costs in Canada (2025):

Residential appraisal: $400 – $700
Multi-family or commercial: $1,500 – $5,000+

Fees depend on complexity, size, location, and urgency.

10. Appraisals vs. Realtor CMAs: What's the Difference?

Appraisal: Licensed, regulated, defensible in court or financing
CMA (Comparative Market Analysis): Informal opinion by a realtor, helpful for listing decisions

Both are useful, but only an appraisal holds legal and financial weight in high-stakes situations.

The Appraiser's Role in a Changing Market

In 2025, the role of a real estate appraiser is more vital than ever. With economic shifts, tech disruption, and tighter lending rules, objective property valuation is essential.

Whether you're a buyer, seller, lawyer, or lender, understanding the appraiser's role can help you make more confident, financially sound decisions.

For trusted, expert appraisals in your area, always seek a qualified, experienced professional who knows your market.

Have appraisal questions? Need a report? Contact Cade Appraisals today.