How Much Does a Home Appraisal Cost in Texas?

Why is a home appraisal needed?

Your new home serves as collateral for the mortgage loan. If you defaulted on your loan, the bank can repossess it and try to sell it to recoup their losses. Therefore, they want to ensure that your home is worth enough to cover the loan.

“A mortgage lender is not going to approve the property for financing if the sales price is far in excess of the home’s actual value based on appraisal,” says Stives.

In more active real estate markets like Austin and Dallas, with rapidly appreciating prices, this is even more important. Austin’s home values jumped 6% between April 2024 and 2023, and while growth is slowing, it’s still a strong market. Banks worry that rapid price appreciation could lead to a bubble, their loan could be underwater, and the asset securing the loan is now worth less. They order home appraisals to protect themselves from losing money.

An appraiser also assures buyers that they’re not overpaying for a house. If you’re making an all-cash offer, you don’t want to end up owning a home that’s worth less than what you paid. Couples that are getting divorced might need an appraisal when dividing assets and one party wants to keep the house. And if you’re selling to — or buying from — a friend or relative, it ensures fairness.

How does a home appraisal work?

There is more than one type of home appraisal. The desk appraisal — where the appraiser researches comparable properties at their desk and never visits the property — became more common during the pandemic. But the sales comparison approach is most common in the industry.

With the sales comparison approach, the appraiser reviews recently sold properties that are similar to the home you’re buying. They’ll adjust the home’s value based on competitive differences — for example, subtracting from the home’s value if it only has one bathroom and comparable properties have two. Essentially, they are attempting to get to a dollar figure that most closely approximates the value that buyers and sellers place on different features.

Appraisers also typically conduct an on-site visit. They’ll bring a tape measure and camera to check square footage, document its curb appeal, evaluate upgrades, and note the home’s overall condition. Any physical deficiencies, such as a cracked foundation, or detractors, like a lack of central air, subtract from the home’s value.

Everything they find goes into the Uniform Residential Appraisal Report. Appraisers must substantiate their opinion with research and reasoning.

In addition, neither the borrower nor the chosen lender decides who the appraiser will be. The lender must work through an appraisal management company (AMC) to have an independent, third-party appraiser assigned to the property. This ensures an unbiased opinion for both parties.

A typical home appraisal takes several hours to a day.

What do home appraisers look for in Texas?

Home appraisers have a general list of items that they consider before getting into specifics for your state. “Generally, features, amenities, and property condition play an important role in an appraiser’s valuation of a property,” Stives says.

This is true no matter where you live, but then they’ll evaluate state-specific items.

• Exterior. Home inspectors will look for cracked and flaking stucco, particularly around windows and doors.
• Foundation. Texan homes most commonly sit on concrete slabs, which can have issues with cracks, sagging, and leaks. In fact, six of the top 15 metro areas with foundation issues are cities in Texas.
• Age and condition. 74% of homes in Texas were built between 1970 and 2009. The state’s relatively new housing stock — particularly when compared to other states — and the age of the home they’re inspecting will influence a home appraiser’s conclusions.
• Home improvements. Improvements can add to, or sometimes subtract from, the home’s value. Removing two bedrooms to make a great room for your kids may have worked for your family, but not for the buyer who needs a four-bedroom. Appraisers also look at the quality of remodeling work and compare it to other homes in the area.
• Location and neighborhood. Appraisers consider the condition of other homes and whether it’s a growing or declining neighborhood.

Worried that the home appraisal will return a lower value than the offer price? Be honest with yourself about the home’s potential negatives.

Lay says that it’s hard to be specific about what would lower a home’s value, “If all of the homes in the area are generally well-maintained and have some updating completed over time, and your house has been a rental for the past 20 years and you never do anything to it, it is not going to be worth as much as the neighboring homes.”

If development is shifting away from the neighborhood, or the home was remodeled and it’s now completely different from the norm for the area, this could all lower the appraised value. An experienced agent, who guided you in setting the list price or making your offer, will help you in determining a fair market price that should appraise.

Can a current homeowner get a free home appraisal?

Current homeowners cannot get a free home appraisal. Appraisers are experienced, credentialed professionals who charge for their time. But that doesn’t mean you’re out of luck if you want to know your home’s current value.

You can request a comparative market analysis (CMA) from an experienced agent, often for free. Agents analyze much of the same data as an appraiser, and they also visit your home to draw a conclusion on its value. Most agents view a CMA as a marketing tool and a chance to win your business.

HomeLight’s Home Value Estimator is also a great tool to determine a home’s general value. After you answer a few short questions, the online estimator compares your home to housing market data for your area. Then, it returns a ballpark estimated worth.

Who pays for a home appraisal?

Who pays for a home appraisal depends on the reason for the valuation. Here’s a simple layout of who typically covers the costs:

Purpose of the appraisal	Who generally pays for the appraisal
Refinance	Homeowner/borrower
Home purchase	Buyer/borrower
Pre-listing determination of value	Owner who is planning to sell
Settling an estate	Family or estate assets

If you’re refinancing your current home or buying a new one, it’s on your dime. Sellers who want to get a pre-listing appraisal will pay for it out-of-pocket. For an estate sale, the cost comes from the family or estate’s assets.

When there’s a mortgage or loan involved, the bank will order the appraisal from a group of approved appraisal management companies. These companies provide third-party, outsourced appraisal contractors who are not affiliated with the lender or borrower. The lender arranges for the appraisal but you’ll still pay the appraiser’s fees.

Is a seller pre-listing appraisal worth it in Texas?

Though it’s typically the buyer’s lender who orders the home appraisal, there are times when a seller might want a pre-listing appraisal. A pre-listing appraisal gives a seller a realistic idea of their home’s worth — and a possible list price. It’s a good idea in these situations:

• Your home has unique features
• It’s in a rural location without a lot of comps
• Your property is a ranch, farm, or has commercial uses
• You inherited the home

How do you find an appraiser in Texas?

Your bank typically finds and supplies the home appraiser if you’re taking out a mortgage. For other purposes, such as a divorce or settling an estate, organizations such as Houston Realtors, the Association of Texas Appraisers, and the Appraisal Institute provide online appraiser directories.

One surefire way to find a trusted agent who knows the market is to ask your agent. Real estate agents have built contacts and a network of professionals in your area. In addition to their expert pricing advice, they can recommend a home appraiser. If you’re looking for a great agent, HomeLight can connect you with the names and contact info of several in your area.

A home appraiser isn’t just a requirement, in many cases. Their work benefits you. “You get a disinterested third-party opinion from someone doing an in-depth dive on values in your area,” Lay says. “An appraiser doesn’t care if the value of your house is $500,000 or $900,000; it is what the math says it is.”

You can sleep easier in your new home knowing that you paid a fair price for it.

FAQs about home appraisals in Texas

What factors influence the cost of a home appraisal in Texas?
The cost of a home appraisal varies based on factors such as the size of the property, location, property type (single-family, condo, rural land, etc.), and the complexity of the appraisal. Urban areas may have higher fees than rural locations due to demand and accessibility.

How long does a home appraisal take in Texas?
A standard home appraisal typically takes between 30 minutes to a few hours for the on-site inspection. The full appraisal report can take anywhere from a few days to a week, depending on the appraiser’s workload and the complexity of the evaluation.

Can I choose my own home appraiser?
If you are refinancing or purchasing a home with a mortgage, the lender usually selects the appraiser to ensure an unbiased valuation. However, if you need an independent appraisal (for estate planning, divorce settlements, or cash sales), you can hire a licensed appraiser of your choice.

Are home appraisal fees negotiable?
In some cases, appraisal fees may be negotiable, especially if you are working with a local independent appraiser. However, for lender-ordered appraisals, the fees are generally set and non-negotiable.

What happens if my home appraisal comes in lower than expected?
If an appraisal is lower than the agreed-upon purchase price, the buyer may need to negotiate with the seller for a price reduction, cover the difference out of pocket, or challenge the appraisal by providing additional comparable sales data. In some cases, a second appraisal may be requested.

Do different types of loans require different appraisal fees?
Yes, appraisal costs can vary depending on the type of loan. FHA, VA, and USDA loans often have specific appraisal requirements, which may increase the cost compared to conventional loan appraisals. VA appraisals, for example, typically have fixed fees based on state guidelines.

Is an appraisal the same as a home inspection?
No, a home appraisal determines the fair market value of a property, while a home inspection assesses the condition of the home, identifying potential issues such as structural problems, plumbing, and electrical concerns. Both are important but serve different purposes.

How often should I get my home appraised?
If you are refinancing, selling, or need an updated home valuation for tax or estate purposes, an appraisal may be necessary. However, if you’re just curious about your home’s value, free online home value estimators or a comparative market analysis (CMA) from a real estate agent may be sufficient.

What can I do to prepare my home for an appraisal?
To maximize your home’s appraised value, ensure your property is well-maintained, make necessary repairs, improve curb appeal, and provide the appraiser with a list of recent upgrades or renovations.

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