Inspection vs. Appraisal Differences for Buyers

If you’ve ever wanted to buy a home, then you know that inspections are an absolute must. They can help make the process of finding and purchasing a new home much easier. But what is the difference between an inspection and appraisal? Many people believe that a house inspection is more important than an appraisal, but this couldn’t be further from the truth. The decision to buy a home, especially in today’s market when prices are so high, and interest rates are so low, can make or break an individual’s financial stability. This is why it is crucial to know exactly what an inspection and an appraisal are before buying a home.

What is an Appraisal?

An appraisal is a process that determines the market value of a property. The appraiser looks at many factors when determining the market value, such as the size, location, condition, and recent sales of similar properties. The appraiser will then produce a report that states the property’s estimated market value.

A qualified and certified property inspector can perform appraisals to determine market value. Financial and technical officials carry out the appraisal to evaluate the proposal’s financial, technological, and marketing elements. Appraisers frequently discover issues with the home that they may investigate using home inspectors (either at the same time of the appraisal or another day). They will recommend repairs, replacements, or updates to their client.

See also: Questions to Ask a Home Inspector Before, During, and After a Home Inspection

Benefits Of An Appraisal

An appraisal can help you get the best price for your home, even if it’s not required by law. Here are a few of the ways that an appraisal may benefit you:

● It aids in the approval of a mortgage.

● It prevents you from overpaying for a house.

● If the appraisal comes in low, it provides a cause to lower the house’s selling price.

● It guarantees you pay the correct amount of property taxes.

● It helps in case you decide to refinance your home.

What Happen During an Appraisal

A licensed appraiser examines the property you want to purchase in person and provides a valuation. The cost of an appraisal depends on the size and location of the property. The lender generally selects the appraiser, but the buyer is responsible for paying for him as part of the closing expenses.

The appraiser will measure the property and look for recent upgrades or additions. They will also research recent sales of similar properties in the area to understand what the home is worth. The appraiser will then write a report that includes the property’s estimated market value. The appraiser will spend approximately an hour with you, after which they’ll complete the appraisal at their workplace.

What is an Home Inspection?

On the other hand, an inspection is a process that looks at the condition of the property. The inspector will check for any significant problems with the property, such as structural damage, electrical issues, or plumbing issues. The inspector will then produce a report that states the property’s condition.

The word “home inspection” is somewhat ambiguous. When a buyer purchases a house, they have the right to do several different inspections, and there are several reasons for conducting an inspection when buying a property. The standard home inspection is a general overview of the property’s condition, as reported by an inspector.

Why is Home Inspection necessary?

Home inspections are necessary because they can help buyers avoid purchasing a home with significant problems. The inspector will find any significant issues with the property and make a report. This report can then be used to negotiate with the seller to have the repairs made before the sale is finalized.

An inspection is also essential because it can give the buyer peace of mind. Knowing that the property has been inspected and is in good condition can help the buyer relax and feel confident in their purchase.

See also: Contingencies You Should Never Waive When Buying a Home

What to expect from a home inspection

After signing a contract with the seller, one of the first things you should do is schedule a home inspection. In some low-inventory markets, buyers often employ an inspector before making an offer. It would be best to choose a house inspector that you trust; most people seek recommendations from their agent, ask friends or family members for suggestions, or use a home inspector database, such as the American Society of Home Inspectors (ASHI).

The home inspection will cover all of the systems in the house, from the roof to the foundation and everything in between, including:

● The structure of the house

● Electrical wiring and panels

● Plumbing and fixtures

● Heating and cooling systems

● Insulation and ventilation

● Windows and doors

After the inspection is complete, the inspector will provide a written report that details any problems found. The report will also include recommendations for repairs. In some cases, the inspector may recommend that you consult with a specialist to assess a particular problem.

See also: Window Replacement Cost Guide

Other Real Estate Inspection Contingency That A Buyer Could Perform When Buying A Home

Buyers should always perform a home inspection contingency when buying a home. In addition to the home inspection, there are other inspections that a buyer could perform when buying a house:

●     Radon Inspection: Radon is a hazardous, radioactive gas that seeps up through the ground and can contaminate indoor air. It’s the leading cause of lung cancer in nonsmokers and second only to smoking when it comes to lung cancer fatalities. Radon can be tested for with a do-it-yourself kit or by a professional.

●     Water Test: A water test is used to check water quality coming into the home. This is especially important if the house is on a well, as it can test for bacteria, nitrates, and other contaminants.

●     Mold Inspection: Mold can cause severe respiratory problems, so it’s essential to have a mold inspection performed if there are any suspicions of mold growth in the home.

●     Lead Paint Inspection: Older homes may have lead-based paint, which can be dangerous if disturbed. A lead paint inspection will test for lead and recommend any necessary remediation.

●     Pest Inspections: A home’s exterior and interiors might be subject to a pest inspection to verify that there are no infestations. Termite, powder post beetle, boring bee, and carpenter ant problems can all be significant and should be investigated during a pest inspection.

●     Septic Inspection: A septic inspection is another common inspection done on a home with a septic system. If the property isn’t connected to a municipal sewage system, it will need to have its septic system inspected to ensure proper functioning and drainage. A yearly septic inspection is required because a faulty septic system can lead to significant problems in the house.

●     Chimney Inspection: A buyer may add a chimney inspection contingency if a home has a fireplace. The inspector ensures that the chimney is safe to use. It’s critical to have your chimney inspected to ensure it’s in good working order and safe to use.

●     Foundation/Structural Inspection: It is extremely tough to sell a property having foundation concerns. Many purchasers will be scared away by foundations and structural issues; therefore, a typical inspection is done. It’s critical to ensure the house is structurally sound before putting it on the market.

●     HVAC Inspection: The HVAC system should be inspected to ensure that it is in good working conditions.

Inspection vs. Appraisal: What’s The Difference?

Many people mistakenly believe that a home inspection and appraisals are the same. While they may have some similarities, there are key distinctions between the two:

It’s a survey to assess the property’s physical condition.An appraisal is a method of estimating the property’s worth.  
A complete property inspection necessitates a thorough examination of the property’s structural integrity.Appraisal’s goal is to evaluate the market value of a property, rather than the state of its structures.  
The cost of a home inspection varies based on the size of your house and where it is located. A typical property evaluation costs around $270 and $400.The typical cost of a home appraisal is between $300 and $400.


When deciding whether or not to purchase a house or property, a home inspection is an important clue. It’s a study of the physical condition of a home or property, usually in conjunction with the sale or purchase of the same. A home inspection provides buyers with an objective, physical assessment of the overall state of the residence. On the other hand, an appraisal is an estimation of the market value of a property. It’s worth noting that financial institutions generally require appraisals when considering granting a loan to purchase a home or property.

Amount Of Time To Complete

The time it takes for each activity to be completed is another distinction between an appraisal and a home inspection. Because a home inspector will generally not be the professional in charge of all inspections, such as a chimney assessment, completing them all at once can be time-consuming. Depending on the size of the property, a home inspection might take anywhere from 2 to 4 hours to complete.

On the other hand, an appraisal generally takes around 1 to 2 hours total to complete. The lender appraiser will take measurements of the house, photograph it, and make notes about improvements. The bank appraiser is searching for apparent safety concerns, such as missing handrails and peeling paint and more hidden issues like termites or leaky roofs. But they will not check as detailed as a home inspector.

See also: How Long Does it Take to Buy a House


An inspection is a thorough examination of the home’s overall condition, including a comprehensive report on the physical status, such as structure, construction, and mechanical elements. The aim is to provide the buyer with all of the information they will need to make an informed decision regarding the purchase. Real estate agents use an appraisal to estimate market value and financial institutions to determine the loan amount for which a potential borrower may qualify.


Home inspections are generally performed by certified inspection firms or professional independent home inspectors with the requisite qualifications and certifications. A home inspector must provide a thorough report on the property’s general condition. Whereas a real estate appraiser’s job is to come up with an estimated value for a property or house, which they often do in support of a lending decision.

Appraisers must be licensed by the state in which they practice, and they typically have years of experience in the field. On the other hand, home inspectors are not always required to be licensed or certified.


An appraisal report is typically shorter and provides less detail than an inspection report. The inspection report should be comprehensive and easy to understand. It should also list any major problems with the property that need to be fixed. The report will also state the home’s estimated market value. It also includes the appraiser’s opinion of the property’s market value.


A home inspection is a detailed assessment of the property’s structural condition by a professional and typically costs between $300 and $350, depending on the size of the property or house. Appraising a larger home, more than 2000 square feet, may cost up to $400. The appraisal fee is what pays for an appraisal of the home you wish to buy, which is an estimation of the property’s market value.

How are home inspections and appraisals similar?

Despite having so many differences, appraisals and home inspections have a few similarities. A few of them are:

● Both appraisers and inspectors are licensed professionals who must meet high professional standards. Both roles need licenses and extensive training, and they serve as objective third parties paid to offer their expert opinion.

● The purchasers pay for both inspections and appraisals. The buyer usually picks the home inspector they want to use, while the lender chooses the appraiser. Unless otherwise agreed, the buyer is responsible for both inspectors and appraisers.

● Both appraisers and inspectors have a vested interest in seeing the property sell for as much as possible. They both want to provide an accurate description of the property to help the buyer make an informed decision.

● Both an appraisal and an inspection are performed on the home you are buying during escrow. The house inspection is usually completed within the first week after your offer has been accepted. Similarly, the appraisal is also completed during this time frame.

● Negotiations are possible after appraisal and inspection results are received. If the appraisal is lower than the buying price, the buyer may be able to negotiate with the seller to bring the price down. And if the inspection reveals undisclosed problems with the home, the buyer may be able to renegotiate for a lower price or ask for repairs to be made.

Appraisal And Inspection Costs

These services are beneficial for house purchasers, but they come with a cost. According to HomeAdvisor, an appraisal will cost you $300 and $400. In comparison, inspection costs between $270 and $400. 4 If you have a larger home, a multi-unit property, or a complex property, both procedures’ fees will be higher.

How do you choose an inspector or an appraiser?

When choosing someone to perform a home inspection or an appraisal, there are a few things you should keep in mind:

● First, make sure they are licensed and insured.

● Second, check their references and read their reviews.

● Third, ask how long they have been in the business.

● Fourth, find out if they are affiliated with any professional organizations.

● Fifth, get a quote for their services.

● Finally, make sure you feel comfortable with the inspector or appraiser. You will be working closely with them, so it’s important that you trust their expertise and judgment.


In conclusion, a home inspection and appraisal are critical when considering purchasing a property. A home inspection provides buyers with an objective assessment of the physical condition of the property, while an appraisal estimates the market value. It’s essential to understand the difference between the two to make an informed decision about purchasing a property.

Frequently Asked Questions

Do I need both a home inspection and an appraisal?

While you technically could do one or the other, we recommend doing both. The home inspection will tell you about the physical condition of the property, while the appraisal will give you an estimate of the market value.

How much does a home inspection cost?

Home inspections typically cost between $300 and $350, depending on the size of the property or house.

How much does an appraisal cost?

Appraisals typically cost between $300 and $400, depending on the size of the property or house.

What other inspections can I perform when buying a home?

In addition to the home inspection, buyers could also perform a radon inspection, termite inspection, water test, mold inspection, lead paint inspection, pest inspection, septic inspection, chimney inspection, and foundation/structural inspection.

What’s the difference between a home inspection and an appraisal?

A home inspection is a thorough examination of the property’s physical condition by a professional, while an appraisal is an estimation of the property’s market value.

Written by

Rostislav Shetman is the founder of 9Kilo Moving. He has been in the moving and relocation industry for more than 25 years, making him an expert in his field. Rostislav started as a helper, dispatcher and driver and has worked his way up to owning his own company. He takes great pride in his work and enjoys helping people relocate across the United States of America. When he's not working, Rostislav enjoys spending time with his family and friends. They are the light of his life and bring him happiness every day.