Most realtors think appraisals are just about comparable sales and square footage.
They’re not – and that’s creating problems you don’t even realize. (And it’s not the realtor’s fault!)
Let me start with this: Realtors are some of my favorite clients.
So, if you’re a realtor reading this, you’re already doing an incredible job helping families navigate one of the biggest decisions of their lives.
The fact that you’re here, wanting to learn more about the appraisal process, shows exactly the kind of dedication that makes you great at what you do.
When I was selling houses a million years ago, I wished I knew a real estate appraiser who would have let me in on their secrets!
This post is all about helping realtors understand the appraisal process so we can work together more effectively.
Let’s Pull Back the Curtain
Here’s the thing – there are some aspects of the property appraisal process that most realtors simply aren’t taught.
And why would you be?
You’ve got your own expertise to master.
But understanding these “behind the scenes” details can make a huge difference for your clients and your transactions.
So let’s pull back the curtain and talk about what’s really going on in an appraiser’s head 🙂
1. Price Per Square Foot Isn’t What Realtors Think It Is
I see this one all the time with realtors, and it’s probably the biggest misconception out there.
When you calculate price per square foot by dividing the sale price by the square footage, you’re getting a number – but it’s not telling you what you think it’s telling you.
Here’s why: that number includes the value of the lot, the location, the condition, the upgrades, the market timing, and about fifty other factors that have nothing to do with the actual square footage.
What we actually do: We look at price per square foot as just one piece of a much larger puzzle.
For example: A 2,000 square foot house on a busy street is different from a 2,000 square foot house on a quiet cul-de-sac, even if the price per square foot is similar.
How this helps realtors: When you’re explaining value to clients, focus on the whole picture rather than just the math. It’s much more accurate.
2. We’re Not Just Looking at Recent Sales
I know you work hard to pull those comparable sales, and I appreciate it!
But here’s something that might surprise you: we’re not just looking at what sold recently.
What’s really happening: We’re analyzing the entire market pattern. Sometimes a sale from six months ago is more relevant than one from last week, especially if the recent sale was unusual for some reason.
We’re also looking at active listings, expired listings, and pending sales to understand the full market story.
Why this matters for realtors: If you’re wondering why we didn’t use that “perfect” comp you found, it’s not because we missed it. There might be factors that aren’t obvious from the MLS data that make it less comparable than it appears.
3. The Appraisal Process Has More Steps Than Most Realtors Realize
Some homeowners think we just show up, take some pictures, and plug numbers into a computer. I wish it were that simple!
And their realtor has a tough time explaining otherwise… because for some crazy reason… the appraisal process is often kept a big secret.
That ends here.
Here’s what actually happens:
- Market research and comparable sales analysis (this takes hours)
- Property inspection and detailed measurements
- Verification of property details and improvements
- Analysis of market trends and conditions
- Multiple approaches to value (not just comparable sales)
- Quality review and report writing
The inspection is actually one of the shorter parts of the process. Most of our time is spent at the computer, researching and analyzing.
How this helps realtors and their clients: When your clients understand that we’re doing extensive research, not just a quick walkthrough, they feel more confident in the thoroughness of the process.
4. Why Realtors See More Than We Can
Realtors know the house inside and out. You know about the new HVAC system, the updated electrical, the fact that the roof was replaced two years ago.
But here’s the thing – we can’t see inside walls, and we’re not home inspectors.
What we can assess: Overall condition, visible improvements, quality of materials and workmanship, and obvious maintenance issues.
What we need from realtors: A list of improvements, especially mechanical systems and updates that are not immediately visible. Those permits you helped your clients organize? They’re gold to us.
5. Market Conditions Affect Everything (Even Smart Realtors Miss This)
This one’s huge, and it’s something that changes constantly – even experienced realtors sometimes overlook this factor.
You might have a buyer who’s frustrated because the appraisal came in lower than their offer, but here’s what might be happening: the market could be shifting.
What we’re analyzing:
- How long properties are staying on the market
- Whether prices are trending up, down, or staying stable
- The supply and demand balance in that specific area
- What has sold – and what HAS NOT sold
- Seasonal factors that might be affecting values
Why this matters for realtors: Sometimes an appraisal reflects market reality that isn’t always obvious right away. Truly, we’re not trying to be difficult – we’re trying to be accurate.
6. Every Property Is Unique (Even in Cookie-Cutter Neighborhoods)
Even in developments where all the houses look the same, there are differences that affect value – something many realtors don’t fully consider.
What we’re considering:
- Lot size and topography
- Position relative to busy streets or amenities
- Condition and maintenance level
- Updates and improvements
- Views and privacy factors
That’s why your client’s house might appraise differently than their neighbor’s, even though they have the same floor plan.
7. Realtors, We’re On Your Team (Really!)
Here’s something I want every realtor to know: we want your transactions to close successfully just as much as you do.
When an appraisal comes in low, we’re not trying to kill your deal. We’re providing our professional opinion of value based on market evidence.
What realtors can do: If you disagree with our conclusion, let’s talk about it. Submit a Reconsideration of Value. Submit additional comparable sales or information we might have missed. We’re always willing to review new information.
Remember: We’re all working toward the same goal – helping families make informed decisions about their most valuable asset.
Making the Process Smoother for Realtors and Your Clients
Now that you know what’s happening behind the scenes, here are some ways you can make the appraisal process work better for your clients:
Before the appraisal:
- Help your clients make a list of any improvements or updates
- Make sure the property is accessible and well-lit
- Provide any relevant information about recent sales or market conditions
During the process:
- Be available for questions, but give us space to do our work
- Trust that we’re being thorough, even if it takes longer than expected
After the appraisal:
- Review the report carefully before reacting
- Call us if you have questions about the appraisal process in general
The Bottom Line for Realtors
You don’t need to become an appraiser to be an excellent realtor.
But understanding these aspects of our process can help you set better expectations with your clients and work more effectively with appraisers.
The real estate transaction involves so many moving parts, and we’re all experts in our own areas.
When realtors and appraisers work together and understand each other’s roles, everyone wins – especially your clients.
What’s Next?
Have questions about a specific appraisal or want to understand more about how we evaluate certain types of properties?
I’ve created a quick and easy course specifically for realtors on this very topic.
Also, I’m always happy to chat with realtors who want to better serve their clients.
After all, we’re all in this business because we want to help families make the best decisions about their homes.
The more we realtors and appraisers understand each other’s expertise, the better we can serve them together.
Questions about an upcoming appraisal or want to discuss how we can work together more effectively? Feel free to reach out. I love connecting with realtors who are committed to providing the best possible service to their clients.
This post is all about helping realtors understand the appraisal process so we can work together more effectively.
