Commission a professional appraisal before finalising negotiations

In the "Property Appraisal" step of the real estate buying process, it is important to: Commission a professional appraisal before finalising negotiations. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Ensure the appraiser is independent — not just the one the bank sends

In the "Property Appraisal" step of the real estate buying process, it is important to: Ensure the appraiser is independent — not just the one the bank sends. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Ask the appraiser to explain the methodology used to arrive at the value

In the "Property Appraisal" step of the real estate buying process, it is important to: Ask the appraiser to explain the methodology used to arrive at the value. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

An appraisal that comes in below the sale price is leverage for negotiation

In the "Property Appraisal" step of the real estate buying process, it is important to: An appraisal that comes in below the sale price is leverage for negotiation. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Understand the difference between 'market value' and 'reconstruction value' (for insurance)

In the "Property Appraisal" step of the real estate buying process, it is important to: Understand the difference between 'market value' and 'reconstruction value' (for insurance). A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Check whether the appraiser also reviewed building permits and violations

In the "Property Appraisal" step of the real estate buying process, it is important to: Check whether the appraiser also reviewed building permits and violations. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Keep the appraisal report for insurance purposes and future transactions

In the "Property Appraisal" step of the real estate buying process, it is important to: Keep the appraisal report for insurance purposes and future transactions. A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

Step 10 of 16

Property Appraisal

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Property Appraisal

A property appraisal is required by the bank, but it is also an important tool to ensure you are not overpaying.

What you need to know at this step

What Does a Property Appraiser Do?

A property appraiser (shamai) is a licensed professional (regulated by the Appraisers' Council) who estimates the value of real estate assets. The valuation is based on analysis of comparable market transactions, the condition and location of the property, development potential, and more. An appraisal is a bank requirement before granting a mortgage — the bank will not lend you more than 75% of the value determined by the appraiser.

The Bank's Appraiser vs. an Independent Appraiser

When you take out a mortgage, the bank sends its own appraiser. But note: the bank's appraiser represents the bank's interests — not yours. It is therefore worth considering commissioning an independent appraiser on your behalf, to obtain an additional evaluation.

If the bank's appraisal comes in below the sale price — the bank will give you 75% of the appraised value, not the purchase price. This means you will need to contribute more equity than you had planned.

When Should You Get an Appraisal Before Making an Offer?

In a competitive market, an appraisal before an offer helps you know: is the price the seller is asking justified? If the appraisal comes in lower — you have a negotiation tool. If it matches or exceeds the asking price — you know you are not overpaying.

Appraisal for Insurance Purposes

"Reconstruction value" (appraisal for insurance) differs from a market value appraisal. Reconstruction value is the cost of rebuilding the property from scratch — usually lower than market value (because it excludes the land). Insurance companies typically insure based on reconstruction value. Make sure the property is insured at the correct amount.

What Does a Good Appraisal Report Include?

A good appraisal report includes: details of the property and its area, the valuation methodology used, comparable transactions reviewed, analysis of value-influencing factors (location, floor, parking, condition, etc.), and a conclusion — the market value of the property. Make sure the report includes all the details, not just a final number.

✅ Checklist for this step

1
Commission a professional appraisal before finalising negotiations
2
Ensure the appraiser is independent — not just the one the bank sends
3
Ask the appraiser to explain the methodology used to arrive at the value
4
An appraisal that comes in below the sale price is leverage for negotiation
5
Understand the difference between 'market value' and 'reconstruction value' (for insurance)
6
Check whether the appraiser also reviewed building permits and violations
7
Keep the appraisal report for insurance purposes and future transactions

⚠️ Important Note

The information and calculations on this site are for general guidance only and do not constitute legal, financial, tax, or investment advice of any kind. Tax brackets, interest rates, and other data are updated periodically and may not reflect the current situation at the time of viewing.

Before making any real estate purchase, sale, or investment decision — consult with a real estate lawyer, mortgage advisor, tax advisor and licensed appraiser as appropriate. Do not rely solely on calculator results when making decisions.