Somebody reads a number on a website, hears a different number from an agent, and then a lender's appraisal comes in at a third. The natural conclusion is that two of the three are wrong. That is the wrong frame. They were produced by different people, under different obligations, to answer different questions.
The short answer
An appraisal is an opinion of value from a licensed appraiser, prepared for a lender. A market analysis is a pricing strategy from an agent, prepared for you. An online estimate is a model's output, prepared for nobody in particular. Only one of the three decides what a bank will lend.
The appraisal
Ordered by the lender, not by you, even though you usually pay for it. Performed by a licensed or certified appraiser who is required to work to professional standards and who is meant to be independent of everyone with an interest in the transaction, including your agent. Its audience is the lender's risk department. Its question is whether the property supports the loan.
That independence is the point of it. An appraiser you could influence would be worth nothing to the bank, which is exactly why your agent cannot lean on one.
The market analysis
Prepared by an agent, for the seller, before the house goes on the market. Its question is not what the house is worth in the abstract. It is what will happen if you ask a given price on a given date, and what the likely outcomes look like at three or four different numbers.
A market analysis is a strategy document. It is not an appraisal, it does not carry an appraiser's obligations, and no agent should present one as though it does. I build every Comparative Market Analysis myself, line by line, which mostly means I can tell you which comparable sales I threw out and why. That part matters more than the number at the bottom.
The online estimate
A model, run at scale, on public records and whatever listing data it can reach. It does not know that the lower level is below grade, that the third bedroom has no closet, that the roof was replaced last spring, or that the house backs onto something nobody wants to back onto.
It is not useless. It is a starting bracket, and for a house in a subdivision of near identical floor plans it can be close. For an older house, an acreage parcel, a custom build, or anything that has been added to over thirty years, it is working with the least information of the three and it shows.
Which number to care about, and when
- Deciding whether to sell at all: the market analysis, plus an honest conversation about condition
- Setting a list price: the market analysis
- Getting a loan approved: the appraisal, and nothing else
- Curiosity on a Sunday evening: the online estimate is fine for that, and should stay there
- Divorce, estate, or anything a court or the IRS will read: an appraisal, and usually a specific kind, which is a question for the attorney or the CPA
The uncomfortable part
Agents are not neutral about this. An agent who wants a listing has an obvious reason to hand you a flattering number, and a seller who has been given three opinions will sometimes hire the highest one. That is how a house sits for ninety days and then sells under what it would have brought in week two.
Most agents are paid only when the answer is move. I will tell you when it is not, and I would rather give you the number I can defend than the number that wins the appointment.
The part I will not answer
Which valuation a court, an executor or a tax filing requires is an attorney and CPA question, and the wrong kind of report is an expensive mistake to discover late. What an appraisal gap means for your financing, and who covers it, belongs to your lender and to the language of your contract. I will tell you who to ask and what to ask them.
If you want the strategy version for a specific house, that is what the home evaluation is for. If the question is really whether the house still fits, the Lifestyle Calibration page starts there instead.
This note describes categories of valuation in general terms. It is not an appraisal, not legal or tax advice, and not an opinion of value for any particular property.