Appraiser
An appraisal may be useful when an estate or trust needs an independent professional opinion of a property's value. The appropriate valuation and effective date can depend on why the appraisal is being obtained, so coordinate with the estate's attorney or tax professional when necessary.
There are times when knowing what a property might sell for today is not enough. An estate may need a formal, independent opinion of value for tax, accounting, distribution, planning, or other purposes. That is where an appraiser can become important.
What an appraiser does
A real estate appraiser develops an independent opinion of a property's value using recognized valuation methods and supporting market information. The resulting appraisal is prepared for a specific purpose and as of a particular date.
Why the valuation date matters
An estate may need to understand what a property was worth on a date other than today. For example, a professional advising the estate may request a valuation as of the date of death rather than the property's current market value.
Before ordering an appraisal, confirm why the valuation is needed and what effective date should be used.
Appraisal and market analysis are different
A REALTOR® may provide a comparative market analysis to help understand current market conditions, pricing, and a likely sale strategy. An appraiser provides an independent professional opinion of value for a defined purpose.
Both can provide useful information, but they serve different roles and one does not automatically substitute for the other.
When an appraisal can be especially helpful
- A formal value is needed for tax or estate-accounting purposes.
- A date-of-death value has been requested.
- Real property will be distributed to one or more beneficiaries rather than sold.
- A family member or beneficiary may purchase the property.
- Beneficiaries disagree significantly about the property's value.
- The estate's attorney, accountant, court, lender, or other professional requests a formal valuation.
Choose the appraisal for the purpose
Explain why the appraisal is being obtained and who is expected to rely on it. Different circumstances may require different valuation dates, documentation, or appraisal requirements.
When the appraisal is connected to taxes, litigation, a disputed distribution, or another legal matter, ask the attorney or accountant what is needed before engaging the appraiser.
Quick Reference
- Determine why a formal valuation is needed.
- Confirm the correct effective date before ordering the appraisal.
- Understand that an appraisal and a REALTOR® market analysis serve different purposes.
- Tell the appraiser how the valuation will be used.
- Preserve the completed appraisal with the estate's records.
- Coordinate with legal or tax professionals when the valuation affects their work.
Helpful Tip
Before ordering an appraisal, ask two questions: "What do we need the value for?" and "As of what date?" Those answers can determine the type of valuation the estate actually needs.
Continue Your Journey
Need personal guidance?
Every estate is different. If your question involves legal advice, you should speak with a qualified New Jersey estate attorney. If you are dealing with an estate property or want to talk through next steps, Dennis can help.