How do I find an appraisal business for sale?

An appraisal practice is a professional-services business. It may value real estate, equipment, or both, and its clients may include lenders, lawyers and property owners. Because the work rests on the owner’s name and judgment, these firms are seldom advertised openly. Decide which kind of practice you want first, then work the channels where owners and buyers actually meet.

Where these firms come up for sale

Check business-for-sale listings under professional services, and ask brokers who handle service practices whether any appraisal firm is quietly available. Many sales begin with an owner nearing retirement who would rather hand the files to a known colleague. Others are mergers, where a larger practice wants a smaller one’s clients and staff. Professional associations and peers can be the first to hear, so let people know you are looking.

What you are actually buying

Ask the seller to list the equipment and its condition, and what else the sale includes, such as client and lender relationships, staff, report files and templates. A valuation firm or accountant can assess what they are worth. Some clients keep approved-appraiser lists or panel arrangements. Treat each as a fact to confirm directly with that client, since an arrangement with the current owner may not carry over to you automatically.

How much depends on the owner

Ask who signs the reports, who the clients call, and who wins new work. If most of it runs through the owner, plan for a transition period and ask whether the owner will stay on. Ask also whether the other appraisers are willing to remain, since a team that leaves can take client relationships with it.

• How many clients send most of the work, and how long each has been a client.
• Which lenders or clients use the firm because of a panel or approved list.
• Whether staff appraisers will stay, and on what terms.
• How work is split between real estate and equipment, and which is growing.

Whether the owner’s designation or licence passes to you is a question for the professional body that regulates appraisers and for your lawyer. For help weighing a firm’s own financials, see how to choose a business valuation firm, and the difference between an equipment appraisal and a business valuation is useful if the practice does both kinds of work.