FAQ's

Appraisers work on a confidential basis with their clients (known as a client-appraiser relationship) and have a fiduciary duty to their client similar to that of other professionals such as lawyers and accountants.

Under the AIC’s Canadian Uniform Standards of Professional Appraisal Practice, any discussions on or disclosure of information contained in an appraisal report must be done with the written consent of the appraiser’s client.

Often when a report is completed for mortgage lending purposes, the homeowner is required to pay the appraisal fee but the appraiser’s client is the lending institution making a lending decision for the property based on the report. The lender provides instructions to the AIC member regarding how the report is to be completed.

AIC members are required to comply with the AIC’s standards of professional practice (CUSPAP). CUSPAP requires an AIC member to maintain the confidential nature of their relationship with their client. The AIC member will need written authorization from the lender – their client – to release the report to any third party – including the person who paid for the report. Only the AIC member’s client and any intended user identified in the report are authorized to receive a copy of and rely on the report. Because the AIC member is the author of the report, consent to release must also be obtained from the AIC member.

The homeowner is the lender’s client. You may wish to ask your lender what the lender’s policies and practices are regarding whether or not you (the lender’s client) will pay for the report to be performed, and/or get a copy of that report regardless of whether the loan is approved or denied. This is a business decision by your lender/mortgage broker. An AIC appraiser would not be aware of this information or of any arrangements made between your lender and you – their client.

Market value or fair market value is the most probable price that a property should bring (will sell for) in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: (1) buyer and seller are typically motivated; (2) both parties are well informed or well advised; (3) a reasonable time is allowed for exposure to the open market; (4) payment is made in terms of cash in Canadian Dollars or in terms of financial arrangements comparable thereto; and (5) the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale.

The Real Estate appraiser is not a home inspector nor does he/she do a complete home inspection. An inspection is a third-party evaluation of the accessible structure and mechanical systems of a house, from the roof to the foundation. The standard home inspector’s report will include an evaluation of the condition of the home’s heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems; the roof, attic, and visible insulation; walls, ceilings, floors, windows and doors; the foundation, basement, and visible structure. The Real Estate appraiser is not a home inspector nor does he/she do a complete home inspection. An inspection is a third-party evaluation of the accessible structure and mechanical systems of a house, from the roof to the foundation. The standard home inspector’s report will include an evaluation of the condition of the home’s heating system, central air conditioning system (temperature permitting), interior plumbing and electrical systems; the roof, attic, and visible insulation; walls, ceilings, floors, windows and doors; the foundation, basement, and visible structure.

Simply put, the difference is night and day. The CMA relies on vague market trends. The appraisal relies on specific, verifiable comparable sales. In addition, the appraisal looks at other factors like condition, location and construction costs. A CMA delivers a ”ball park figure.” An appraisal delivers a defensible and carefully documented opinion of value

But the biggest difference is the person creating the report. A CMA is created by a real estate agent who may or may not have a true grasp of the market or valuation concepts. The appraisal is created by a certified professional who has made a career out of valuing properties. Further, the appraiser is an independent voice, with no vested interest in the value of a home, unlike the real estate agent, whose income is tied to the value of the home.

Real estate appraisers typically work for lenders to estimate the value of real estate involved in a loan transaction. They also provide opinions in litigation cases, tax matters, and investment decisions. Additionally, they may work for property owner individuals, businesses, government agencies, or other organizations that require accurate and objective valuations of real property.

An appraiser typically gathers information from various sources to estimate the value of a property, such as public records, multiple listing services, real estate agents, builders, and other industry professionals. They also rely on their own research and analysis, including site inspections and measurements, to determine the property’s characteristics and condition. Additionally, they may consider relevant economic and market data, such as sales trends and forecasts, to arrive at a fair market value.

Getting ready for the appraiser can help ensure a smooth and efficient appraisal process. Here are some tips to prepare for the appraiser:

Make sure the property is accessible: The appraiser will need access to the entire property, including any outbuildings, garages, or other structures. Make sure that any locked areas are accessible, and that the appraiser can easily move around the property.

Clean and declutter: A tidy and clean property makes a good impression and can positively impact the appraisal. Remove any clutter, clean up any messes, and make sure the property is in a presentable state.

Provide documentation: If you have any documentation related to the property, such as renovation receipts, surveys, or floor plans, have them ready for the appraiser. This can help the appraiser better understand the property and any improvements made to it.

Make a list of upgrades and improvements: If you have made any upgrades or improvements to the property, make a list of them to provide to the appraiser. This can help the appraiser better understand the value of the property and any changes that have been made to it.

Be prepared to answer questions: The appraiser may ask questions about the property, such as when it was built, any recent renovations, or other details. Be prepared to answer these questions to the best of your ability.

By taking these steps, you can help ensure a successful appraisal and a more accurate estimate of your property’s value.

The cost of an appraisal can vary depending on various factors such as the type of property, the purpose of the appraisal, the location of the property, and the complexity of the appraisal assignment. Appraisers may charge a flat fee or an hourly rate for their services. It’s important to note that the cost of an appraisal is often a worthwhile investment as it can help ensure that you are making informed decisions regarding your real estate assets.

The length of time it takes an appraiser to inspect a property can vary depending on factors such as the size and complexity of the property, as well as the condition and accessibility of the property. Typically, a residential appraisal inspection can take between 30 minutes to a couple of hours, while commercial appraisals may take several hours or even multiple site visits. It’s best to check with the appraiser directly to get a more accurate estimate of the inspection time for your specific property.

The time it takes for an appraisal report to be completed can vary depending on the complexity of the property being appraised and the appraiser’s workload. Typically, a residential appraisal report can be completed within a few days to a week after the inspection, while a commercial appraisal report can take several weeks or even months to complete. It’s important to discuss the expected timeline with the appraiser before hiring them to ensure that their turnaround time aligns with your needs.

The decision to order a private appraisal or go through your mortgage broker or bank depends on several factors such as the purpose of the appraisal, the type of property being appraised, and the lender’s requirements.

If you are applying for a mortgage or refinancing through a bank or mortgage broker, they will likely order the appraisal as part of their loan process. In this case, you may not need to order a private appraisal.

However, there may be instances where a private appraisal is necessary or preferred. For example, if you are purchasing a property for cash or need an appraisal for estate planning or tax purposes, you may choose to order a private appraisal.

It’s important to note that if you do order a private appraisal, the lender may still require their own appraisal before approving your loan. In this case, you may end up paying for two appraisals.

Ultimately, the decision of whether to order a private appraisal or go through your mortgage broker or bank will depend on your specific situation and needs. It may be helpful to consult with a qualified appraiser or mortgage professional to determine the best course of action.

When you refinance your mortgage, the bank needs to verify the current value of your home to ensure that the amount of the new loan is appropriate for the property’s value. Since property values can fluctuate over time, the bank requires a new appraisal to confirm the current value of your home. Additionally, the bank may require an appraisal from one of their approved appraisers to ensure an unbiased and accurate valuation.

If you order an appraisal, you have paid for the service and are therefore the owner of the appraisal report. You have the right to use the information contained in the report as you see fit, within legal and ethical boundaries. However, it’s important to note that the appraiser who prepared the report has a professional obligation to follow appraisal standards and ethics, and therefore the report should not be altered or misrepresented in any way that would violate those standards. Additionally, if the appraisal was conducted for a specific purpose, such as for a mortgage loan, the lender or other party who ordered the appraisal may have specific restrictions on how the report can be used or shared. The appraisal report is a legal document with a clearly identified purpose (for example, mortgage financing or divorce/separation). It can only be utilized for the purpose in which it was intended.

Appraisals are done during regular office hours, but exceptions can be made on a case-by-case basis..

Appraisers are bound by professional rules of ethics and a strict confidentiality agreement not to disclose any information except with the client or the individuals/institutions approved by the client who ordered the appraisal. In most cases, our client is hired on behalf of the homeowner or purchaser. To discuss any information, we need written approval from the ordering client.