What is the purpose of a property appraisal?

The primary purpose of a property appraisal is to determine the property's market value. Appraisals are typically conducted by licensed professionals who assess the property based on various factors, including its condition, location, comparable sales in the area, and market trends. This valuation is crucial for buyers, sellers, and lenders, as it establishes a fair market price that reflects the property's worth in the current real estate market.

While other options may involve aspects of property evaluation, they do not fulfill the core objective of an appraisal. Deciding on renovation planning focuses on improving a property rather than assessing its value, calculating potential rental income pertains to estimating income-generating capabilities rather than establishing market worth, and evaluating neighborhood trends offers insight into the area’s market dynamics but does not directly appraise the property itself. Therefore, determining market value stands out as the central role of a property appraisal.