When considering the value of your property, it’s important to recognize that home appraisals and current market assessments (sometimes called Comparative Market Analyses or CMAs) are two different tools—and they serve distinct purposes.

What is a Home Appraisal?

A home appraisal is a formal evaluation conducted by a licensed appraiser who assesses your property’s value based on very specific criteria. Key points include:

• The appraiser examines physical attributes of the home — such as its condition, age, size (square footage), layout, and structural components (foundation, roof, utilities).
• They will analyse recent sales of comparable properties (often called “comps”) in the area, making adjustments for differences.
• An appraisal is typically required by a lender when a mortgage or refinancing is involved, since the lender wants assurance the property supports the loan amount.
• It results in a detailed report and is more rigid in methodology.

What is a Current Market Assessment (CMA)?

A Current Market Assessment is a less formal evaluation of what your home could sell for in the current marketplace. Key aspects:

• A CMA is often performed by a real estate professional, looking at recently sold properties, active listings and market trends in your neighbourhood.
• It factors in market conditions — supply and demand, time of year, buyer sentiment — all of which an appraisal may not capture in the same way.
• The goal is generally to help set a listing price (if you’re selling) or inform your strategy, rather than satisfying financing requirements.
• It is more flexible and market-driven rather than strictly rooted in structural or historical data.

Why Do These Two Values Often Differ?

Because these tools are designed for different purposes, you’ll often see a discrepancy between what a formal appraisal says and what the market assessment suggests. Some reasons:

• An appraisal tends to be conservative and based on verified data and comparable sales at a fixed point in time.
• A market assessment may reflect current buyer behavior, multiple-offer situations, seasonal trends, or hype in a hot market — factors that can drive prices above what an appraiser might estimate.
• Physical attributes (condition updates, unusual features) might carry more weight in a CMA because buyers may pay a premium for certain upgrades; but an appraiser might adjust more strictly for those.
• Timing differences: markets can shift quickly, meaning a recent CMA may show a higher (or lower) realistic listing price than an appraisal done some weeks earlier.

When Each Value Matters Most

Knowing when to lean on one versus the other can help guide decision-making:

• For lending or refinancing purposes: The appraisal is what matters most. Lenders rely on the appraised value to underwrite their risk.
• For setting a listing price or determining what you might accept in an offer: The market assessment is typically more useful because it aligns with what buyers are doing right now.
• For strategic negotiation: If an appraisal comes in lower than expected, knowing the market value (via CMA) can help in discussions: Should you adjust the price, ask for concessions, or reconsider timing?
• For investment planning: A keen understanding of market value gives insight into future appreciation, competition in the market, and whether you’re pricing competitively.

Bottom Line

While both a home appraisal and a current market assessment aim to place a value on your property, they each speak a different language. One is methodical, official and used primarily for financing; the other is practical, flexible and tuned to what buyers will actually do in the moment. Understanding the distinction helps you set realistic expectations—whether you’re gearing up to list, buy, or refinance.

If you’re preparing to sell or refinance and would like assistance benchmarking your home’s value — whether by a formal appraisal or a market-based assessment — we can help you navigate which approach fits your situation best.