The earliest examples of appraisals date back to ancient history, as people bartered among themselves for goods, services, lands, and anything of value. The exchange or value for both sides had to be fair and equal or the trade was not made. Coin mintage began in about 600 BC, and created a medium of exchange, which advanced valuation. Goods, services, and land could then be priced or “valued” for a certain amount of coins.
Since modern times, real estate has been priced or valued in dollars in the United States. Price is defined as the dollar amount at which someone buys, sells, or lists a property. Value is an opinion of what property is worth – the appraiser provides his opinion of the value of a property. Buyers, sellers, and brokers all have their opinions of the value of a property. When a property sells and closes, then that sets the actual closing price, which represents the exchange of the real estate title for dollars, between a willing buyer and a willing seller, each properly informed, and acting in their own best interests.
The final closing price and pre-closing opinion(s) of value may or not coincide, but in most cases, they fall within a reasonably close range.