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Can an AVM (Automated Valuation Model) Replace an Appraisal?

Can an AVM (automated valuation model) ever replace a full house appraisal? The answer to this question really depends on your business model.

The higher risk the deal, the further you may want to go to validate collateral.

Before you can answer the question of whether or not you can replace an appraisal with an AVM, you have to look at the distinct differences between the two.

  1. What it is
  • Appraisal

An estimate of a property’s value made by a professional.

  • Purview AVM

An AVM is a mathematically based computer program that produces an estimate of the market value of a residential property based on analysis of public record data, property location, market conditions, and real estate characteristics at a specified date.

  1. How it is performed
  • Appraisal

An appraiser goes to a subject property, performs an on-site inspection, does research, and reviews comparable sales as it relates to the subject property. From this, they formulate an estimated property value.

  • Purview AVM

Typically, the street address of the subject property is entered as input into the AVM system. The system in turn identifies the property, checks its location, size, and other key features and searches its systems database for the best set of comparables or indices to generate a value for the subject property.

Not all AVMs are the same. Some AVMs, like Emili for example, do not evaluate a specific property.

  1. Pros


You have boots on the ground and can consider the property’s condition. In refinances you may learn that the property is not owner-occupied or uncover undisclosed construction or tenants.

Purview AVM

  • Instant.
  • Less expensive.
  • Automated and accurate.
  • Derives data from POLARIS (the Province of Ontario Land Registration Information System).
  1. Cons


  • Takes time to complete – often a week.
  • Expensive – a appraisal can cost between $300 to $400.
  • Can be impacted by the appraiser’s personal opinion about a customer, their home, or the neighbourhood.
  • You don’t know the source of the data that they use to perform their comparative sales research.

Appraisers who receive a high volume of deals through brokers have reported being pressured to bring in a property higher, even offering alternate sales comparables to the appraiser.

Purview AVM

  • You are unable to visually inspect the property.

So, to answer the question that is the title of this article: yes, an AVM can replace an appraisal. An AVM can also be used hand-in-hand with an appraisal.

Many lenders and brokers have found value in looking at an AVM at the application stage and before sending the application into the underwriting process. Doing this enables you to avoid the time and expense for you and the client because if there is an issue with the property’s value, it will be revealed in the AVM.

You may decide after looking at an AVM that you would like a house appraisal to assess the property’s condition. This is an excellent idea!

In most cases, choosing an AVM or an appraisal isn’t an either-or decision. It all depends on the deal, the level of fraud detection you need, and your personal business model.

If you do go with an AVM, you need to make sure you are choosing a provider who gives you accurate, up-to-date property data. And that provider also needs to be B-20 compliant if you are a mortgage lender.

With Purview’s AVM, you can rest assured that our property data is top-of-the-line (since it is derived from POLARIS) and it is B-20 approved.

Find out how you can access a Purview AVM today. Call 1.855.787.8439 or visit


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