Appraisal
Learn how appraisals work in Canadian real estate, why they’re essential for financing, and how they influence property value and mortgage terms.

May 22, 2025
What is an Appraisal?
An appraisal is an unbiased professional estimate of a property's market value, typically conducted by a certified appraiser during a real estate transaction or refinancing process.
Why Appraisals Matter in Real Estate
In Canadian real estate, appraisals help lenders determine whether a property's value supports the requested mortgage amount. Appraisals are often required for:- Mortgage approvals
- Mortgage refinancing
- Divorce settlements or estate planning
- Comparable recent sales
- Location and neighbourhood trends
- Property size, age, and condition
- Renovations or upgrades
A lower-than-expected appraisal can affect financing, requiring a larger down payment or renegotiated price. Conversely, a high appraisal can help buyers secure better terms.
Understanding how appraisals work protects both buyers and lenders from overpaying or under-lending on a property.
Example of an Appraisal
A lender orders an appraisal for a $750,000 home. The appraiser values it at $725,000, and the buyer must increase their down payment to bridge the gap.
Key Takeaways
- Determines property market value.
- Required for financing and refinancing.
- Conducted by licensed professionals.
- Affects loan approval and terms.
- Based on property and market data.
Related Terms
- Market Value
- Mortgage Approval
- Comparable Sales
- Real Estate Valuation
- Home Inspection













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