blog

Real estate is one of the most dynamic industries in the world. Markets rise and fall, new developments appear, and cycles of growth and correction come and go. But here’s something that doesn’t fluctuate nearly as much: the need for appraisers.

Whether the market is hot or cooling, lenders, investors, and property owners rely on accurate, unbiased valuations to make critical decisions. That makes appraisal a uniquely stable career path in a cyclical industry.

Why Appraisal Is Different From Other Real Estate Careers

Unlike brokerage or development—where income often swings with the market—appraisers provide an essential service that’s in demand through every market cycle. Lenders need valuations for loans, investors need them for acquisitions, and owners need them for financial reporting.

That means appraisers enjoy a level of stability and predictability that’s harder to find elsewhere in real estate.

Work-Life Balance: Hours That Make Sense

Another advantage? The hours. Compared to other real estate careers—or even high-demand corporate roles—appraisers often enjoy more predictable schedules and better work-life balance. While client deadlines and busy seasons exist, the profession allows for a level of flexibility that’s hard to beat in today’s economy.

A Clear Progression Path

Appraisal isn’t just a job; it’s a career with a well-defined ladder of growth.

• Start as an intern or associate under a certified appraiser.
• Gain experience and pass exams to become certified general.
• For those aiming high, the MAI designation from the Appraisal Institute is the gold standard. It signals deep expertise and opens doors to complex, high-value assignments and leadership opportunities.

This clear progression path means that anyone entering the field knows exactly what steps to take to advance and succeed.

Why LPA?

At Lowery Property Advisors, we’re proud to offer:

• A supportive environment where trainees can grow into experts.
• Exposure to a wide range of commercial property types and valuation scenarios.
• Opportunities to work alongside seasoned MAI-designated appraisers.
• Competitive pay, benefits, and a career path that rewards your commitment to the craft.

Ready to Start Your Appraisal Career?

We currently have several entry-level opportunities available. If you’re curious about starting your career in appraisal—or if you know someone looking for a stable, rewarding path—explore our openings today at lowerypa.com/careers.

When you’re buying, selling, or refinancing commercial real estate, one of the most important steps in the process is the appraisal. An appraisal gives an unbiased opinion of the property’s market value, which is often required by lenders, investors, and sometimes even courts to assist in making informed decisions regarding commercial real estate. But a common question many property owners and investors ask is: who actually pays for the commercial appraisal?

Let’s break it down.

The Role of a Commercial Appraisal

A commercial appraisal isn’t just a formality. It’s a detailed report prepared by a licensed appraiser that examines:

• The property’s condition, size, and use
• Comparable sales in the market
• Rental income potential
• Local market conditions

Because commercial properties are often complex and unique, these appraisals can take longer and typically cost more than residential reports.

Who Usually Pays?

In most cases, the party requesting the appraisal is the one who pays for it. Here’s how that works in different situations:

1. Buyers & Borrowers

If you’re applying for financing to buy or refinance a commercial property, the borrower usually pays. Lenders often require an independent appraisal before approving a loan to ensure the commercial property serves as sufficient collateral for a loan. While the lender orders the appraisal, the cost is typically passed on to the borrower.

2. Property Owners

Sometimes, a property owner might request an appraisal before listing their property for sale. In this case, the owner pays because they want to set a fair asking price and understand the property’s true market value. 

3. Sellers & Developers

In competitive situations, a seller or developer might choose to pay for an appraisal upfront to present to potential buyers. While not as common, this can aid in building trust and speed up negotiations.

4. Courts or Legal Proceedings

During disputes like divorce, estate settlements, or partnership dissolutions, a court-ordered appraisal may be required. The court usually decides who pays, which could be one party or both.

How Much Does a Commercial Appraisal Cost?

The cost depends on factors like:

• Scope of the assignment and complexity
• Type of appraisal report (restricted vs. full narrative)
• Location and available market data

On average, commercial appraisals can range from $2,000 to $10,000 or more. Specialized properties like hospitals, schools, or manufacturing plants may cost even higher due to their complexity and limited availability of similar market data.

Can the Cost Be Shared?

Yes. In some transactions—especially large or complicated ones—the buyer and seller may agree to split the cost of the appraisal. This arrangement is less common but can happen when both parties benefit equally from the valuation.

Why You Shouldn’t Cut Corners

It may be tempting to look for the cheapest appraisal option, but quality matters. A well-prepared appraisal provides credible, defensible results that can hold up with lenders, courts, and investors. An inaccurate or rushed appraisal, on the other hand, can delay financing, derail deals, and even lead to costly disputes.

Final Takeaway

So, who pays for a commercial appraisal? Most often, it’s the borrower or property owner, but the responsibility can shift depending on the situation. The key is understanding the role the appraisal plays in your transaction and planning for the cost upfront.

At LPA, we know commercial appraisals are an investment in your success. We deliver accurate, on-time reports that are easy to read and give you the confidence to move forward. Call us today or contact us online to get started with the commercial appraisal firm you can trust.

Big news in the lending world this week: mortgage rates just fell to their lowest point of the year.

According to Freddie Mac’s latest data, the 30-year fixed mortgage rate dropped to 6.58% (down from 6.63% last week). The 15-year fixed slid too, now averaging 5.71%.

That may not sound like a massive dip, but in a market where every fraction of a percent matters, it’s enough to get both residential buyers and commercial investors paying closer attention.

---

Why Does This Matter for Commercial Real Estate & Appraisals?

While mortgage rate headlines usually focus on the residential market, the trickle-down effect into commercial real estate is real. Here’s why:

• Investor Sentiment Shifts
  Lower mortgage rates often boost confidence across the real estate spectrum. If buyers feel like capital is becoming slightly cheaper, it can nudge investors off the sidelines — meaning more demand for commercial properties.

• Cap Rates & Valuations
  Mortgage rates don’t directly dictate cap rates, but they influence borrowing costs, which affect how buyers underwrite deals. As financing becomes more attractive, appraisers may see adjustments in projected returns that impact valuations.

• Comparable Sales Activity
  With a bit more buying activity in the residential space, we often see renewed energy in mixed-use and small commercial properties. More transactions means better comps for appraisers and a clearer picture of market value.

• Construction & Development Outlook
  Builders are cautiously optimistic, but with rates still high compared to the 3-4% days of the past, they’re offering price cuts and incentives. That pressure in the residential sector can spill over, making lenders and appraisers keep a close eye on feasibility studies for new commercial projects.

---

Looking Ahead

The Fed is expected to weigh in this fall with possible rate moves. Even though mortgage rates don’t follow the Fed one-to-one, bond yields and investor expectations are keeping downward pressure on long-term rates.

For now, the key takeaways for our commercial world:

• Cheaper capital = potential uptick in demand

• Valuations may begin to reflect improved financing conditions

• Appraisal timelines could tighten as transaction volume increases

---

Bottom Line

Mortgage rates dipping to 6.58% may be making homebuyers smile, but the ripple effects touch the commercial real estate and appraisal space too. Every small rate movement changes how investors evaluate opportunities, and that means appraisers need to stay sharp on shifting market dynamics.

You need a commercial real estate appraisal to make the most informed decision, but are unsure if it will take days, weeks, or months. Understanding the timeline matters because it affects your steps moving forward.

The truth is, timelines vary based on the complexity of the assignment, intended use of the appraisal and the appraiser’s availability based on their existing workflow. The right guidance can help you move forward with confidence. At LPA, we know the process inside and out. We keep you well-informed, meet deadlines, and deliver accurate results. Call us or contact us online today to start the appraisal process with an expert partner.

Why Timelines Can Vary

No two commercial properties are exactly alike. A small owner-occupied office building takes less time to appraise than a large multi-tenant downtown office tower. Factors that affect the timeline may include:

• Property size and complexity. Larger or unique properties typically require more research and analysis.
• Availability of data. Missing leases, contracts, financial statements, budgets, or site plans can cause delays.
• Type of appraisal report. A restricted/evaluation report may take less time than a full narrative appraisal report.
• Market conditions. In busy markets or higher volume times of year, appraisers may have longer wait times before starting an assignment due to existing projects already in the pipeline.

Understanding these factors will help you plan ahead and set realistic expectations. 

The Typical Timeline for a Commercial Appraisal

While there’s no one-size-fits-all answer, most commercial appraisals follow a general schedule. Here’s what to expect:

1. Engagement and Scheduling (1–3 business days)

Once you choose an appraisal company, the engagement process begins. The appraisal firm will take into account the intended use of the appraisal, property specific details, and deadlines. The appraisal firm will then respond back to you with their related fees and timing to complete the assignment based on those factors.  Typically, the appraisal firm will offer a variety of fees and timing options. Generally speaking, the more truncated the timeline to complete the appraisal assignment results in a premium on the fee, all other factors being the equal.

2. Research and Data Collection (5–10 business days)

This includes an in-person physical site visit to the property being appraised (unless otherwise agreed upon during the engagement/scheduling process), gathering public records, reviewing leases/budgets/contracts, compiling and confirming market sale/rental data and interviewing active market participants that can include investors, developers, brokers and property owners.

3. Analysis and Report Preparation (5–10 business days)

The appraiser will then select the most comparable sales, analyze any income potential, and the replacement cost. They then prepare the written report summarizing the research performed and adjust the confirmed market data into a reasonable range based on factors of comparability for that specific property type. This process supports their findings and concluded final opinion of value which can be presented as a singular number or a range of values.

4. Review and Delivery (1–3 business days)

The final report is reviewed for accuracy and consistency before being delivered to you by the agreed upon date.

Total estimated time: 1–4 weeks for most properties, though complex assignments may take longer.

Special Situations That Affect Timelines

Some projects take longer due to the specialized nature of the property or complexity of the overall assignment, such as:

• Special-use properties like hospitals, schools, or manufacturing plants.
• Multiple property appraisals in a portfolio assignment.
• Limited or a-typical comparable market data
• Environmental concerns require extra research and analysis.

When these apply, an experienced appraiser will set realistic expectations from the start of the engagement process.

Preventing Appraisal Delays

To avoid delays in the submission of the finalized appraisal report, the onus is on you, the client! Key items that greatly assist in keeping the process and final submission of the report on track, include:

• Providing the property specific requisite documents upfront: This includes contracts, leases, rent rolls, tax records, any renovation/construction budgets and site plans.
• Being available for questions. Commercial appraisal are typically more complex than residential assignments due to a variety of factors.  Your timely responses to the appraiser’s questions which may occur throughout the process will greatly help prevent unnecessary delays.

An experienced firm will also know how to streamline without sacrificing quality.

Working With the Right Appraiser

Choosing the right professional makes all the difference in your timeline and your results. Keynote things to look for include:

• Proven experience and competency with your property type.
• Clear communication throughout the entire process from engagement to submission.
• Ability to meet deadlines without cutting corners.
• Strong reputation for well-supported, accurate and defensible reports.

LPA brings all of these qualities to every assignment. We combine deep, tenured market knowledge with a commitment to service.

Your Next Step

If you’re feeling uncertain about how long your appraisal will take, you’re not alone. Many property owners start with the same questions. The good news is you don’t have to figure it out on your own.

Get Results on Time with LPA

Timelines matter in commercial real estate. Delays can cost money, cause missed opportunities, or hold up financing. At LPA, we provide well-supported and accurate appraisals with clear communication and 100% on-time delivery, every time. Our process is transparent, our team is responsive, and our results are reliable!

Call us today or contact us online to get started. We’ll guide you from day one, set a clear timeline, and deliver your appraisal as promised. You can move forward with confidence.

Last Thursday, our team attended an insightful luncheon hosted by the North Texas Risk Management Association on August 7, 2025, at First United Bank Plano–Parkwood. The forum featured a powerhouse panel of appraisers: Jeff Garvin, MAI (Bank OZK), K. Lynn Ray, MAI, CCIM (Veritex Bank), and Gary D. Ray, MAI (First Horizon Bank)—together, bringing over a century of combined banking and valuation experience.

---

Market Watch: Trends, Challenges, and Opportunities

As we listened and took note, the discussion unfolded organically. First, the panel raised a question: are current cap rates actually reflective of today’s market? From there, they dove into the shifting landscape of banking, predicting a likely wave of consolidation that’s positioning firms to deliberate more strategically about valuation risk.

A notable comparison emerged between the multifamily markets of Dallas and Austin. Dallas has demonstrated resilience, maintaining a robust market, while Austin’s multifamily sector has become more affordable due to frenzied growth and construction. Interestingly, the entire Dallas–Fort Worth metroplex now boasts more apartment units than the combined total of North and South Carolina, both of which are currently experiencing strong apartment demand and construction.

Regarding affordability, the gap between multifamily and single-family housing is significant. While this disparity isn’t yet a systemic issue in the DFW area, it is becoming a major concern in other regions.

The retail sector earned high marks as the most resilient sector, as its pre-COVID slowdown in development helped avoid the oversupply many feared.

Land development often serves as an early indicator of market shifts. When demand wanes, land can become stagnant, tying up capital and hindering growth. However, in the Dallas–Fort Worth area, land development remains active and responsive to market needs. Developers are strategically focusing on high-growth suburban regions like Frisco, McKinney, and North Fort Worth, where population expansion and rental demand continue to drive development. “Build it and they will come”? That mantra is… questionable right now, making this targeted approach essential. By aligning projects with areas of sustained demand, developers ensure land is utilized effectively and contribute to the region’s ongoing growth.

Another trend catching attention: suburban walkability. Communities that offer more pedestrian-friendly designs are gaining traction. Why? People want convenience and lifestyle, not just square footage. Walkable developments are proving more attractive, and that’s shaping how new projects are planned and valued.

---

Inside Business: The People, The Process, The Pressures

As market complexity grows, so does the debate over appraisal fees. Should they rise to reflect more complicated analysis? In theory, yes—but in practice, it was discussed that keeping fees competitive while paying staff fairly can be a tough balancing act. Technology can help. At LPA, we leverage tech to streamline processes, keeping costs down without sacrificing quality.

A significant concern raised was the aging demographic of MAI appraisers, with the average age being 63. This suggests a potential shortage as seasoned professionals retire, potentially impacting the quality and availability of appraisals. Compounding this is the observation that many younger bankers, having experienced predominantly appreciating markets, may lack experience in downturns, underscoring the cyclical nature of real estate markets. Panelists noted that we might be entering a depreciation cycle, leading to a market where both buyers and sellers adopt a wait-and-see stance, with sellers hesitant to sell unless they absolutely must.

Quality control is another hot topic. Banks spend more time reviewing appraisals than ever before, with some devoting $200-$500 in staff time per commercial report to ensure accuracy. Not all banks have third-party reviewers; some rely on internal staff, but when pressure exists, third parties can be brought in to provide an additional layer of oversight. At LPA, we maintain strict quality control by having experienced reviewers double-check work, ensuring consistency and reliability before any report reaches a client or lender.

Finally, an appraisal’s validity based on the length of it’s existence was discussed: it was noted that appraisals can typically remain useful under six months but are “good until they’re not.” Banks are increasingly cautious with older reports—anything over six months may trigger a review, past 12 months likely calls for a new appraisal, and reports beyond two and a half years simply don’t hold weight.

---

What This Means for Us

This discussion reaffirmed how important it is for us to stay alert to market shifts and valuation complexities. By emphasizing tech-enabled efficiency, understanding demographic trends, and embracing appraisal best practices, we can better support our clients, especially across multifamily and development sectors sensitive to cycles and affordability pressures.

Whether you’re acquiring, disposing of, financing, or managing a commercial asset, appraisal reports are essential tools. They influence negotiations, underwriting decisions, tax assessments, and long-term investment strategies.

Choosing the wrong type of appraisal—or misunderstanding its limitations—can delay deals or lead to inaccurate valuations. Here’s a breakdown of the most commonly used types of commercial property appraisals and when each is most appropriate.

---

The Two Primary USPAP-Compliant Appraisal Types

According to the Uniform Standards of Professional Appraisal Practice (USPAP), there are two primary report types:

• Appraisal Report

• Restricted Appraisal Report

Both require the appraiser to consider the three approaches to value. The appraiser then chooses the most relevant methods to produce credible results for the specific assignment.

---

1. Appraisal Report

The Appraisal Report is the most commonly requested and utilized format. It provides detailed, written narrative analysis and typically includes one or more of the following approaches to value:

Sales Comparison Approach

The Sales Comparison Approach is often the go-to for owner-occupied properties or assets in active markets. It estimates value based on recent sales of similar properties, adjusted for key differences.

Best used when:

• There are multiple recent comps within a defined market
• The subject property is similar in size, age, and use
• There’s low reliance on projected income

This approach is especially useful for small retail buildings, office condos, or flex/industrial spaces in high-volume areas.

---

Income Capitalization Approach

The Income Approach is most relevant for properties with consistent income streams, like leased investment assets. It’s grounded in net operating income (NOI) and cap rate analysis to determine present value.

Two common methods:

• Direct Capitalization: Divides NOI by market cap rate
• Discounted Cash Flow (DCF): Projects income over time and discounts future cash flow

Ideal for:

• Multi-tenant office buildings
• Apartment complexes
• Shopping centers
• Hotels

This method reflects how investors view performance and return expectations.

---

Cost Approach

The Cost Approach estimates value based on what it would cost to replace the property today, minus depreciation, plus land value. This method is most useful when comps are limited or the structure is new or unique.

Consider using the cost approach for:

• Special-use properties (e.g., hospitals, schools, churches)
• Brand-new construction
• Insurance purposes

It’s less influenced by market trends and focuses more on tangible replacement cost.

---

2. Restricted Appraisal Report

A Restricted Appraisal is limited in scope and typically for internal use only. Although the scope of work may be similar to an Appraisal Report, a Restricted Appraisal Report is significantly more abbreviated and much of the analysis is “stated” rather than “summarized”. It includes fewer details than a full narrative or summary report and may not meet lender or investor requirements.

Use when:

• You need a quick internal valuation
• The report will not be shared externally
• You’re early in a planning or feasibility phase

These are cost-effective and time-efficient—but not suited for every purpose.

---

3. Desktop Appraisal

A Desktop Appraisal is completed without a physical inspection of the property (neither exterior or interior inspection completed). USPAP does not require an appraiser to personally inspect a property, although many users of appraisals require an inspection.

The appraiser relies on public records, third-party data, maps, and past reports.

Useful for:

• Review or monitoring of stabilized assets
• Properties with known characteristics and minimal recent change
• Low-risk internal reviews

Note: Most lenders and institutional partners still require more in-depth reporting for transactional use.

---

4. Drive-By Appraisal (Exterior-Only)

An Exterior-Only Appraisal, also called a drive-by, includes a site visit but no interior inspection. It blends first-hand visual data with market research.

Best for:

• Properties with access limitations
• Low-risk refinance scenarios
• Assets in stable submarkets

While faster and less expensive, this method offers only a partial view of the property’s condition and income potential.

---

Ready to Choose the Right Appraisal? We’re Here to Help.

Navigating commercial real estate appraisal options doesn’t have to be complicated. At Lowery Property Advisors, we combine market expertise with a client-first approach to deliver clarity and confidence—whether you’re closing a one-off deal or managing a large portfolio.

You’ve built your business on smart decisions. Let us support that with accurate, timely, and actionable valuation services.