What’s the Difference Between a Licensed Appraiser’s and a Real Estate Agent’s Opinion of Value?

There shouldn’t be much difference if the appraiser and the real estate agent are both knowledgeable, competent and impartial. However, if the real estate agent is not a licensed appraiser, they can’t call their opinion of value an appraisal. Instead, the agent might call it a broker’s price opinion (BPO) or a comparative market analysis (CMA).

If the agent is not a licensed appraiser, they don’t have to comply with the Uniform Standards of Appraisal Practice (USPAP) and their opinion can’t be used to support a federally-related transaction such as a home loan. However, real estate agents can appraise property for a wide variety of other purposes.

Real estate agents don’t usually charge a fee for their BPOs or CMAs, because this service can be an effective way to get listings. Although some sellers will only list with the agent who gives them the highest value estimate, experienced agents don’t waste their time with clients who won’t accept a realistic listing price.

In Europe, there is less of a distinction between appraisers and real estate agents because their services are often combined within the same office. In the United States there are people who are both licensed appraisers and licensed real estate agents. The National Association of Realtors(r) even offers a special designation program for realtor(r)/appraisers.

What if someone is both a licensed appraiser and a licensed real estate agent? Although this has not yet been tested in court, it’s a safe bet that the licensed appraiser is required to adhere to the Uniform Standards of Appraisal Practice (USPAP) when rendering any opinion of value, oral or written, point or range, for any reason.