How is an appraisal best defined?

An appraisal is best defined as an estimate of value. This definition captures the essence of what an appraisal aims to achieve: to provide a professional, informed opinion regarding the value of an asset, which can be real estate, personal property, or business interests. The appraisal process involves a systematic evaluation that considers various factors, including market conditions, comparable sales, and property characteristics, to arrive at this value estimate.

This understanding is crucial as it differentiates an appraisal from other valuation concepts like depreciation or replacement cost considerations. An appraisal is specifically focused on ascertaining current market value rather than merely reflecting costs or conditions that may not accurately represent the worth of an asset.