Today’s REI Classroom Lesson

In the classroom today, Danny Regalado explains the difference between BPOs (broker price opinion) and Appraisals.

REI Classroom Summary

BPOs are normally quicker and lower cost, while appraisals can be much more accurate, as Danny Regalado explains.

Listen to this REI Classroom Lesson

Real Estate Investing Classroom Show Transcripts:

Mike: Welcome back to the REI Classroom, where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now, let’s meet today’s expert host.
Danny: Hi, this is Danny Regalado and you’re watching the REI Classroom. Today, we’ll be talking about the differences between a BPO and an appraisal.
Mike: This REI Classroom real estate lesson is sponsored by FlipNerd Investor Coaching, your blueprint to investing success.
Danny: A BPO is a broker price opinion. These are limited valuations that are performed by real estate agents or real estate brokers. These usually give a general view of the market, but are not very specific, as they usually don’t include adjustments. These reports are provided by real estate experts that are trained in the sales department of the industry rather than the valuation department of the industry. Therefore, these values are not as accurate as an appraisal report.
An appraisal report is performed by a certified or licensed appraiser. The difference here is you have a college-level graduate that has spent many, many years getting certifications in different titles and different expertises in how to determine value with different techniques and methodologies. This is the most accurate form of valuation that exists now. The appraisal reports are more in-depth. They usually include physical measurements of the subject property, complete interior, exterior inspections and an analysis of not just closed sales but pending sales and active sales.
They also analyze the market. Is it an increasing market, is it a stable market, is it a declining market? The ratio of how many sales have sold in the last six months, three months, one month, and different aspects, as far as absorption rates, supply and demand factors in each different market.
The benefits of using a BPO are cost and timeliness. BPOs are usually 50% if not lower cost than an actual full appraisal, but conversely, they are turned around much quicker than a normal appraisal. You can get a BPO in one or two days versus five to seven days on a certified appraisal in certain markets.
The difference is BPOs can’t be used for federally related transactions where the appraisals can be used for federally related transactions. Some of the benefits of the appraisal is a more accurate valuation that can be relied upon and much more information, such as the sketch, interior photos, flood maps, location maps and general market data having to do with economic factors.
Mike: The FlipNerd Investor Coaching program is America’s most robust real estate investor training and designed for your success. If you’re ready to roll up your sleeves, ready to take personal responsibility for your own success and ready to dive into a world-class instructional coaching program that provides you step-by-step instruction to help you achieve financial freedom, then you need to visit to learn more. Spaces are limited. Whether your goal is to simply get started or to take your business to the next level, you may be a fit for our life-changing program. Learn more today at
Please note, the views and the opinions expressed by the individuals in this program do not necessarily reflect those of or any of its partners, advertisers or affiliates. Please consult professionals before making any investment or tax decisions, as real estate investing can be risky.
Are you a member yet of, the hottest real estate investing social community online? If not, you can join for free in less than 30 seconds and get access to hundreds of off-market deals, vendors in your market to help you in your business, and you can start networking with thousands of other investors just like you. Get your free account now at
Please check out the FlipNerd family of real estate investing shows, where you can access hundreds of expert interviews, quick tips and lessons from leaders across the real estate investing industry. They’re available at or simple search for FlipNerd in the iTunes store.