Difference Between A Home Inspection And A Home Appraisal

If you are getting ready to purchase a new home, you must complete numerous things before sitting down at the closing appointment. Two of these are your home inspection and your home appraisal. Although they sound very similar, there are huge differences between the two. A lender typically requires one but not the other. One determines the value, while the other determines the condition, but which does what? Here is what you need to know about both of these services.

Buying a home is potentially the most significant single investment a person will ever make. To ensure this purchase is a good investment, inspecting the property from the roof to the basement is essential. The best way to do this is through a home inspection. A home inspection is a highly recommended, but not required, step before your purchase.



A home inspection is a thorough visual evaluation of your home's structure and its functions by a trained inspector. It’s designed to provide you with a comprehensive assessment of the home's condition. The inspection is done prior to your purchase. The inspector looks specifically for problem areas that may need some repair. Some standard things examined are:

• Roof

• Attic

• Foundation

• Floor joists

• HVAC

• Plumbing and electrical

• Appliances

• Well/Septic System

• Walkways, patios, driveways, and decking

In addition to the overall visual inspection, the inspector may suggest a more in-depth examination to look for termites, mold, and radon. Once completed, the inspector is required to submit a written report outlining their findings.

A home inspection can uncover issues that may force you to take your offer off the table. For example, if the inspector finds mold in your home that has caused structural damage, repairs could become very expensive.

As the property buyer, you will have the opportunity to choose the inspection company you want to perform your inspection. It will also be your responsibility to pay for it. Fortunately, an inspection is not very expensive, considering the amount of information it provides.

The average cost can be about $339, depending on the inspector and the size of the property. Other add-on services such as thermal imagining, which can detect many other issues beyond what the inspector can visually see, can add on a couple hundred more. 

A home appraisal determines the value of the property in question. Appraisals are much less in-depth than a home inspection and may be completed without anyone physically visiting the property. When performed this way, they are considered a desktop appraisal. The available online information determines the value of the property. This information may include:

• Property records
• Floor plans
• Comparable properties

Appraisers may also use tax records and other electronic information. 

Appraisers can also perform drive-by appraisals based on exterior appearances alone. Evaluations consider your home's basic condition, any upgrades or improvements made to the property, and other similar properties in the surrounding communities. 

Although your lender utilizes a home appraisal to determine how much money you qualify to borrow, the mortgage company does not perform the home appraisal. These assessments are conducted by independent third parties who then submit a written report containing their valuations.

As the buyer of the property, you pay for the home appraisal. They will cost $312 to $419, but they can be higher or lower in price. The fluctuation in pricing depends on the appraisal company and the demand at the time of the request.

Secure One Capital will answer any questions you have about your home inspection and appraisal, along with any other questions you have about the home buying process. Give us a call today so we can help you purchase the home of your dreams.