Commercial real estate appraisals differ from residential appraisals, so if you have ever bought a house and experienced the appraisal process, it will be different for commercial real estate. Commercial appraisals are done for multifamily properties with 5 or more units or any other commercial property type like industrial properties, office buildings, retail, or hotels, etc.

Cost of CRE Appraisals

CRE appraisals cost more than residential appraisals. Residential appraisals cost between $300 and $500, whereas commercial appraisals cost on average $4,000, but can vary depending on the property. Commercial appraisals also take longer to complete since they are more complex. The appraiser evaluates factors like income and rental prices, tenants with long-term leases, and the recent selling price of similar properties in the area.

Appraisals vs BOV’s

BOV stands for broker’s opinion of value (sometimes also referred to as a BPO: Broker Price Opinion) and they are similar to appraisals, however, they have their time and place for use. A BOV is put together by a commercial real estate broker on behalf of their client, usually for free, as they are trying to win over the client. BOV’s can be as simple as 1-2 pages or can be more detailed and as lengthy as 50 pages. It consists of the broker’s best guess at valuation backed by market data and industry knowledge.

When it comes to taking out a loan on a property, an appraisal is generally required. Other situations that require an appraisal are for estate sales, divorces, or determining tax liabilities. You might also need to have an appraisal done before listing a property in order to determine the sales price.

Looking To Get Started?

Simple Commercial Capital is here to help you navigate all of the CRE mortgage options available. Look through the loan programs found at the top of our page. Each program has a brief description and loan parameters. If one of the loan programs fits your needs click the Apply Now button to start the application process or call us at 1-866-554-1120 to discuss your options in more detail. Our goal is to make this process as simple as possible for you.