When you buy a home, your lender will order an appraisal to determine the fair market value
The appraisal is important to the lender because the home serves as collateral for the loan. If you’re unable to repay your mortgage
and the lender forecloses, it wants to be able to sell the home to
recoup the money it lent you, so it has to make sure you’re not
Learn more in my Mortgage-Calc.com article, Factors That Influence a Home's Appraisal Value.