Appraisal: licensed/certified appraiser's OPINION of value — required for most financed deals
Before you read
Test yourself first: 5 questions
Question 1 of 5
A comparative market analysis (CMA) prepared by an agent is:
Answer: B. A CMA estimates likely market value from comparable sales to help price a listing or offer — it is NOT a formal appraisal.
Question 2 of 5
Professional appraisers in the U.S. follow the standards known as:
Answer: A. USPAP (Uniform Standards of Professional Appraisal Practice) governs ethical and performance standards for appraisers.
Question 3 of 5
In an appraisal, reconciliation means the appraiser:
Answer: A. Reconciliation weighs the reliability of each approach for the property type to form a single, supported value opinion — never a mere average.
Question 4 of 5
The principle of substitution states that the maximum value of a property tends to be set by:
Answer: A. Substitution holds that a knowledgeable buyer will pay no more for a property than the cost of acquiring an equally desirable substitute, making it the foundation of all three appraisal approaches.
Question 5 of 5
A comparable sold six months ago when the market was rising about 1% per month. To account for the change in market conditions, the appraiser would make a:
Answer: B. A time or market-conditions adjustment accounts for price changes between the comparable's sale date and the effective appraisal date.
Keep the streak going with more questions like these, each with a full rationale.
Must-know rules
- CMA: agent's comparative analysis to set a LIST price — free, not an appraisal
- BPO: broker price opinion for a lender/relocation firm — allowed where state permits, fee OK
- Appraisal: licensed/certified appraiser's OPINION of value — required for most financed deals
- Federally related loans need state-licensed/certified appraisers (FIRREA)
- Agents must never call a CMA an 'appraisal'
CMA vs BPO vs Appraisal: FAQs
Is CMA vs BPO vs Appraisal on the real estate exam?
Yes. Valuation & Appraisal is a scored domain on the real estate licensing exam, and this topic appears in the national portion.
Is this cheat sheet free?
Yes — every page on Cinna RE's resource library is free to read, print and share. The app adds practice questions, mock exams and a readiness score.
