What is the primary purpose of an appraisal in real estate?

The primary purpose of an appraisal in real estate is to determine a property's fair market value. This assessment is fundamental for various transactions, such as buying, selling, or refinancing a property, as it helps all parties involved understand the accurate value based on current market conditions. An appraisal takes into account various factors like the property's location, condition, and comparable sales, providing a well-rounded analysis that is vital for making informed decisions.

While promoting properties, conducting virtual tours, and inspecting for structural integrity all play important roles in the real estate process, they do not directly address the core function of an appraisal, which is primarily to establish a fair market value. Understanding this distinction is crucial for real estate professionals, as it helps them navigate transactions effectively and maintain a standard of practice in the industry.