What is the primary purpose of a property appraisal?

The primary purpose of a property appraisal is to determine the market value. An appraisal involves a professional assessment of a property's worth, typically conducted by a licensed appraiser who evaluates various factors such as the property's condition, location, and recent sales of comparable properties in the area. This valuation is crucial for various stakeholders in real estate transactions, including buyers, sellers, and lenders, as it establishes a fair market price and assists in making informed decisions.

While establishing mortgage eligibility, identifying potential defects, and calculating property taxes are all important functions related to real estate, they do not encapsulate the primary reason for a property appraisal. Mortgage eligibility is more about the financial aspect and a borrower's ability to repay, potential defects relate to the physical condition of the property rather than its value, and calculating property taxes involves using assessed values set by local governments, which can differ from market value determined by appraisals. Hence, determining market value remains the foremost objective of a property appraisal.