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What is a Broker Price Opinion?

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Whether you’re thinking about selling your home or refinancing, a broker price opinion can provide valuable insight to inform your decision. A broker price opinion is just what it sounds like: An opinion by a real estate expert, such as an agent or a broker, about your home’s value.

Similar to a home appraisal, a broker price opinion helps establish what your home is worth. But a broker opinion of value is considered less accurate than an appraisal and may not be allowed to substitute for an appraisal.

How does a broker price opinion work?

A broker price opinion, also known as a broker opinion of value or a home valuation, is an estimate of a property’s market worth provided by a licensed real estate professional, says Matt Dolan, a real estate broker at Sagan Harborside Sotheby’s International Realty in Marblehead, Mass.

“In order to provide a broker price opinion, we look at comparable homes that have sold recently, typically within the past three months in the same neighborhood, and make pricing adjustments based on a variety of factors such as the size, condition and location of the home,” Dolan says.

Broker price opinions or BPOs for short, are typically presented in a written format and may include an analysis and summary of current market conditions. They also tend to have a short shelf life as home values are fluid, Dolan adds.Some broker price opinions are external, with just a visual inspection of the home’s exterior, while others include a tour of the home’s interior to evaluate its condition.

A broker price opinion can be used by a homeowner trying to decide whether to refinance or make some home improvements, says Elizabeth Lucchesi, a real estate agent with Long & Foster Real Estate in Alexandria, Va.

In addition, lenders sometimes use a broker price opinion instead of a home appraisal to estimate a home value for a streamlined refinance, foreclosure or short sale. A broker price opinion can cost about one-half to three-fourths of the cost of an appraisal, according to the National Association of Broker Price Opinion professionals.

Pros and cons of a broker price opinion


A BPO can provide a price range based on market conditions. Dolan points out that while BPO pricing is a range rather than an exact number, it’s based on a real estate expert’s knowledge of current market trends and can be useful while setting a listing price.

A BPO can be quicker than an appraisal. In an active real estate market with many purchases and refinances, appraisals can be hard to schedule.

A BPO costs less than an appraisal. BPOs can cost a fraction of the price of an appraisal.

A BPO can be a substitute for an appraisal. A BPO can sometimes be used by lenders for a foreclosure or short sale, or for a borrower’s request to cancel private mortgage insurance (PMI).


A BPO isn’t always as accurate as an appraisal. An appraisal is done by a licensed, certified appraiser rather than a real estate agent or broker.

A BPO can’t always be used as an alternative to an appraisal. Some mortgage transactions require an official appraisal rather than a BPO, particularly for a home purchase.

A BPO may be considered subjective. A BPO is done by an agent whose commission is based on the sales price, rather than an objective, third-party professional.

A BPO may be restricted by some state and federal laws. State laws vary on when and how a BPO may be used.

When you can and can’t use a BPO in real estate

Broker price opinions are most commonly used by homeowners who want to establish a listing price to sell their home, or to decide whether they want to refinance or make improvements.

When you can use a BPO

To decide whether to refinance. If you’re not sure you have enough value in your home to refinance, a BPO can be a quick and inexpensive way to find out before applying for a loan.

To determine a listing price for your home. A BPO can help you decide how much to ask for your home. “BPOs are often more accurate when there is solid data and when the agent providing the opinion is experienced,” Dolan says.

To eliminate private mortgage insurance. Some lenders will accept a BPO as proof that you have more than 20% home equity and can cancel PMI.

To facilitate a foreclosure or short sale. Some lenders will allow a BPO to be used instead of an appraisal.

When you can’t use a BPO

To obtain a purchase mortgage. Lenders are usually required to have a full appraisal of a property before approving a home loan.

To refinance your mortgage. In most cases, a full appraisal is required for a refinance. However, a broker price opinion can be used for purposes other than a mortgage approval in states like North Carolina, for example. If you have an FHA or VA loan, you may be eligible for streamlined refinance that doesn’t require an appraisal.

To apply for a home equity loan or line of credit. Similar to other mortgage loans, you typically need a third-party appraisal to borrow from your home equity.

To evaluate a unique property. “Unique homes can be harder to price and assign a value,” Dolan says. “When we list historic properties or oceanfront properties, there are rarely comps.”

BPO vs. appraisal

Both broker price opinions and appraisals are based on real estate market data and the educated opinions of real estate experts. However, appraisers are licensed and regulated, and may be more objective than a real estate agent. A broker opinion of value has its place in real estate transactions, as do appraisals.

Broker price opinion vs. home appraisal

Broker price opinion Home appraisal
Based on predictive data Based on historical data
About one-half to three-fourths the cost of an appraisal Costs $300 to $400 or more
Unregulated Regulated
Performed by real estate agents or brokers Performed by licensed real estate appraisers

BPO and home appraisal differences

  • Appraisals are conducted by licensed and trained appraisers. Appraisers are required to follow the Uniform Standards for Professional Appraisal Practice (USPAP).
  • Appraisals are required for most mortgages. Lenders typically require a professional appraisal for a purchase mortgage and often for a home equity loan or refinance.
  • Appraisals look at historic market data rather than trends. Appraisers review recent sales to compare home values, rather than trends such as the pace of sales or price fluctuations.
  • Appraisals cost at least twice as much as broker price opinions. Appraisal fees can be $300 to $400 or more, depending on your location and the size of your home.
  • Appraisals can be more objective. “The divergence [between an appraisal and a BPO] is the BPO factors in the emotional tug of the house and its effect on potential buyers,” Lucchesi says. “The BPO can also factor in marketing strategies.”

BPO and home appraisal similarities

  • BPOs and appraisals look at sales of comparable properties. Both an appraiser and a real estate agent will evaluate homes that are similar to yours in size, condition and neighborhood, preferably homes that sold within the previous few months.
  • BPOs and appraisals rely on real estate experts for opinions. Both are an opinion of the value of a property, Dolan says.
  • BPOs and appraisals rely heavily on market data. An appraisal and a broker price opinion evaluate data including recent sales, lot size and the number of bedrooms and bathrooms to determine a home price.

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