ORDER A BROKER PRICE OPINION
What is a BPO?
You’ve probably heard of a real estate appraisal, but many have never heard of a broker’s price opinion (“BPO”). It’s not an appraisal. It’s a professional opinion of value from a real estate licensee (in this case, an actual broker) who uses the sales comparison approach to assign an opinion of value.
The report is usually 15 to 40 pages long and includes comparable properties and information on local market conditions. MLS sheets and public data is included for properties where available.
How do I get a BPO for my client?
Please complete this form.
What do we need to do?
A broker price opinion is developed by gaining authorized access to the home and reviewing its condition and amenities. This can include taking photos of the property. We’ll need to coordinate a time to meet at the property. Plan on completing seller disclosure forms prior to the meeting. This does not obligate you to sell, it gives the broker a more complete history of the property.
You’ve probably heard of a real estate appraisal, but many have never heard of a broker’s price opinion (“BPO”). It’s not an appraisal. It’s a professional opinion of value from a real estate licensee (in this case, an actual broker) who uses the sales comparison approach to assign an opinion of value.
The report is usually 15 to 40 pages long and includes comparable properties and information on local market conditions. MLS sheets and public data is included for properties where available.
How do I get a BPO for my client?
Please complete this form.
What do we need to do?
- Request an appointment
- Provide access to the property
- Complete Seller Disclosure forms prior to the appointment
A broker price opinion is developed by gaining authorized access to the home and reviewing its condition and amenities. This can include taking photos of the property. We’ll need to coordinate a time to meet at the property. Plan on completing seller disclosure forms prior to the meeting. This does not obligate you to sell, it gives the broker a more complete history of the property.
What does a BPO generally include?
Broker's price opinion is an estimate prepared by a licensee that details the probable selling price of real estate and provides a varying level of detail about the real estate's condition, market, and neighborhood, and information about sales of comparable real estate.
How is it different from an appraisal?
The primary difference between a broker price opinion and an appraisal is cost. Your BPO will be performed by an actual licensed real estate broker living in the area using the sales comparison methodology.
How much does a BPO cost?
A standard residential BPO costs about 70% less than a typical appraisal. A BPO starts at $150, where an appraisal by a certified general appraiser is usually $600 and more for a typical residential dwelling. Costs can vary by dwelling size and locality.
Broker's price opinion is an estimate prepared by a licensee that details the probable selling price of real estate and provides a varying level of detail about the real estate's condition, market, and neighborhood, and information about sales of comparable real estate.
How is it different from an appraisal?
The primary difference between a broker price opinion and an appraisal is cost. Your BPO will be performed by an actual licensed real estate broker living in the area using the sales comparison methodology.
How much does a BPO cost?
A standard residential BPO costs about 70% less than a typical appraisal. A BPO starts at $150, where an appraisal by a certified general appraiser is usually $600 and more for a typical residential dwelling. Costs can vary by dwelling size and locality.
What if the subject property is too complex?
If the valuation is too complex, involves more than real estate (for example, the sale of a business and its assets) or requires a speciality beyond the expertise of the broker, it should be referred to a certified general appraiser.
Why do people use a BPO instead of an appraisal?
Simply put, because it’s often cheaper and achieves similar results in most cases. And it’s quite a bit faster.
How do you determine value?
Many of the methods that brokers use to determine value are similar to what an appraiser uses to determine value. We look for real property that is similar in character and nature, and try to assign an opinion of market value close to expected sales price.
What’s the shelf life of a BPO?
About 6 months, maximum. It should be updated closer to final determination to make sure market changes have not impacted the initial value.
Why 6 months? This timeframe accounts for the seasonality of home sales - sales may be slow in winter, and hot in the summer. Using a timeframe of 6 months gives a truer picture of both busy and slower seasons and is more predictive of projected sales activity than a longer time period.
How are appraisals different than a BPO?
First, cost is a large factor. Second, appraisers must follow stringent quality control guidelines called USPAP (Uniform Standards of Professional Appraisal Practice).
Appraisers can also assign value to more than just real property (real estate); they can give an opinion of value on personal property, intangible assets, and business valuation, as well as conduct appraisal analyses.
Other important information:
A real estate licensee in Kansas is not an appraiser unless that person also holds an appraisal license. A broker’s price opinion is not an appraisal as defined in Kansas statutes.
If the valuation is too complex, involves more than real estate (for example, the sale of a business and its assets) or requires a speciality beyond the expertise of the broker, it should be referred to a certified general appraiser.
Why do people use a BPO instead of an appraisal?
Simply put, because it’s often cheaper and achieves similar results in most cases. And it’s quite a bit faster.
How do you determine value?
Many of the methods that brokers use to determine value are similar to what an appraiser uses to determine value. We look for real property that is similar in character and nature, and try to assign an opinion of market value close to expected sales price.
What’s the shelf life of a BPO?
About 6 months, maximum. It should be updated closer to final determination to make sure market changes have not impacted the initial value.
Why 6 months? This timeframe accounts for the seasonality of home sales - sales may be slow in winter, and hot in the summer. Using a timeframe of 6 months gives a truer picture of both busy and slower seasons and is more predictive of projected sales activity than a longer time period.
How are appraisals different than a BPO?
First, cost is a large factor. Second, appraisers must follow stringent quality control guidelines called USPAP (Uniform Standards of Professional Appraisal Practice).
Appraisers can also assign value to more than just real property (real estate); they can give an opinion of value on personal property, intangible assets, and business valuation, as well as conduct appraisal analyses.
Other important information:
A real estate licensee in Kansas is not an appraiser unless that person also holds an appraisal license. A broker’s price opinion is not an appraisal as defined in Kansas statutes.