Appraisal and real estate valuation are two often-confused terms commonly used in the real estate sector, seeing as they both appear to refer to the same thing.
At Lasose Properties & Investments we explain exactly what these concepts consist of, so you can be clear about what each one means and which one you need, depending on whether you are buying or selling a property.
Real estate valuation is used to establish an indicative value of a property by applying different existing valuation methods. However, this is not a legally-recognised document.
In order to carry out a real estate valuation it is not necessary to visit the property, nor are the characteristics or conditions of the property analysed, but the cadastral data is taken into account. It is advisable nevertheless to know the real estate market in order to carry out a simplified study, and apply a valuation method to calculate the approximate price of a property.
Real estate appraisal, on the other hand, does establish a legal value for a property. This process has a methodology regulated by the ECO/805/2003 order and authorised technicians must be called in to carry out the appraisal.
The main difference, then, between real estate valuation and appraisal is the legal nature of the document. It is useful to know what each of them is for so you can determine which one is of more interest according to your objective.
If what you need is an approximate value to put a property up for sale, a real estate valuation will suffice. If you wish to know the value of a property so as to apply for a mortgage, carry out a distribution of assets in the case of either separation or inheritance, or if the information needs to be provided for the Tax Authorities, then a real estate appraisal will be necessary.