What is the main difference between "appraisal" and "assessment"?

The main distinction between appraisal and assessment lies in their purposes and applications. An appraisal is a professional evaluation of a property's market value, carried out by a licensed appraiser or real estate professional. This valuation is often needed during a sale, refinance, or for investment purposes, and it reflects what a buyer is willing to pay in the current market conditions.

On the other hand, an assessment is conducted primarily for taxation purposes. Local governments assess properties to determine their value for the calculation of property taxes. This process ensures that real estate taxes are based on fair market values but might not occur as frequently or with the same level of detail as appraisals.

The other options provided are incorrect for the following reasons: Appraisals are not dictated by a set schedule such as annual or bi-annual assessments; they are conducted as needed. Additionally, both appraisals and assessments take into account various features of a property, both interior and exterior, to accurately determine value. Lastly, while there may be fees associated with appraisals, particularly for professional services, assessments are typically factored into general property tax processes rather than being standalone services.