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Just as you can grieve your taxes, you can submit a realtor's appraisal and comps to challenge the bank's appraisal. It is common practice. I personally know of three people who have done so and in two cases the banks revised the valuation based on the realtor appraisal and the comps. While realtors routinely try to sell houses for as much as they possibly can--that is their job if they're the seller's agent--this is a matter of submitting an appraisal based on recent comps. I imagine that it is the comps that sway the bank, not the realtor's opinion.
There are a lot of dumb realtors out there who want to get the listing by providing the highest market value. Homeowners fall for it.
The problem is if you price a house that is worth 725K and 795K, you chase away potential hot buyers who can spend no more than 725K. So the house sits on the market. And sits and sits and sits. By the time the price is reduced it has become a "stale" listing, and is much more difficult to sell.
Does Fannie Mae provide finanancing based on a realtor's appraisal? That's news to me.
There are a lot of dumb realtors out there who want to get the listing by providing the highest market value. Homeowners fall for it.
The problem is if you price a house that is worth 725K and 795K, you chase away potential hot buyers who can spend no more than 725K. So the house sits on the market. And sits and sits and sits. By the time the price is reduced it has become a "stale" listing, and is much more difficult to sell.
Does Fannie Mae provide finanancing based on a realtor's appraisal? That's news to me.
We're talking apples and oranges here. You're talking about what realtors do to get a listing and what their pricing strategy is--sometime they list high to leave room for haggling, sometimes they list low in the hopes of getting multiple bids, etc. The appraisal a realtor makes to a potential seller is very different than the formal appraisal they put together to challenge a bank apprasial. The latter is based on the recent comps and is not about pricing strategy. As far as I know the only time you can submit a realtor's appraisal to a bank is to challenge the bank's apprasial--not in lieu of one. My point was that bank appraisals are incredibly flawed and don't reflect a house's current market value--a fact which even banks acknowledge.
To give some perspective, we are in contract on a home in Chappaqua in the mid-700k range, and the purchase price is $20k less than what the sellers paid in 2007. House is not huge (3/2) but already has plans and plumbed for adding 2 bedrooms and a bath upstairs, and it's in move-in condition on a nice lot/street. We got very lucky as we are renting in the area and were able to jump on it fast, and we already had our mortgage situation lined up (this is huge - mortgages are much harder to get these days than even 1-2 years ago).
Obviously every situation is unique but roughly 3% discount against 2007 prices sounds expensive, at least as a generalization. I realize that there are slim pickings when it comes to the lower end in Chappaqua but we're looking for more like 2003 prices, not 2007 prices. 2007 prices are near peak prices since in Westchester the prices basically flatlined while the rest of the country began slipping. It really wasn't until 2008 that Westchester started to really tank (if you can call it that).
In any event, perhaps the last buyers got a great deal in 2007. I'm sure you've done your homework before committing to the purchase.
Obviously every situation is unique but roughly 3% discount against 2007 prices sounds expensive, at least as a generalization. I realize that there are slim pickings when it comes to the lower end in Chappaqua but we're looking for more like 2003 prices, not 2007 prices. 2007 prices are near peak prices since in Westchester the prices basically flatlined while the rest of the country began slipping. It really wasn't until 2008 that Westchester started to really tank (if you can call it that).
In any event, perhaps the last buyers got a great deal in 2007. I'm sure you've done your homework before committing to the purchase.
Obviously every situation is unique but roughly 3% discount against 2007 prices sounds expensive, at least as a generalization. I realize that there are slim pickings when it comes to the lower end in Chappaqua but we're looking for more like 2003 prices, not 2007 prices. 2007 prices are near peak prices since in Westchester the prices basically flatlined while the rest of the country began slipping. It really wasn't until 2008 that Westchester started to really tank (if you can call it that).
In any event, perhaps the last buyers got a great deal in 2007. I'm sure you've done your homework before committing to the purchase.
I can only speak from our experience having been actively looking in the Pleasantville/Chappaqua/Thornwood/Briarcliff/Armonk area for the past year: 2003 pricing is pretty unrealistic, especially for homes with the more popular "desireable" attributes such as village/walk to train location, move-in condition, .5 acre+ lot, newer kitchen/baths, attached garage, central AC, etc. Those kinds of houses still have bidding wars (trust me we've been in a few). Based on comps and the fact that this house is a great fit for us, we are comfortable with our price. Now the whole contract and mortgage process has been another story...
I can only speak from our experience having been actively looking in the Pleasantville/Chappaqua/Thornwood/Briarcliff/Armonk area for the past year: 2003 pricing is pretty unrealistic, especially for homes with the more popular "desireable" attributes such as village/walk to train location, move-in condition, .5 acre+ lot, newer kitchen/baths, attached garage, central AC, etc. Those kinds of houses still have bidding wars (trust me we've been in a few). Based on comps and the fact that this house is a great fit for us, we are comfortable with our price. Now the whole contract and mortgage process has been another story...
Good luck with your home Cali! Please don't take this personally, like I think you didn't make a good deal or something! You have much more info about the area than I do. I just know what I want and what I feel comfortable paying for. I do NOT like being near that 39% mark that mortgage companies will give out begrugdingly. I think there can be good options for my family, just like there was for your family. I just have to be patient and see what becomes available.
I keep focusing on a house that was a bit small for us (like 2100 sq ft) that had been redone and looked beautiful. It also had a large finished basement. It was listed originally at over 750K (I think), came down to 725K on the listing. It eventually sold for 645K. I think 645K was a good price for that house. Now I want that house, in that condition, just scaled up a bit (2800 to 3000 sq ft) and maybe one more room if I can get it. If that house went for 645K then what I want should be about 700K. That's what I'm looking for.
There is a house on Lori for sale that I think could work for us. Not perfect, but it backs up to a condo unit that backs up to the train. Not ideal. It's also listed for 800K. I think given the situation about the location, that is a 700K house.
Good luck on the closing. NY closings are very different than most states. It's that closing on or about such and such a date that can be a nightmare. It means that one attorney or another can decide to change the date on a whim - just because he has a golf game he doens't want to be late for. Trying to get everything nailed down with attorney's involved is MUCH more difficult than other areas of the countries where you just talk through your realtors and get the job done. Hope all goes well!
I don't know the Chappaqua market as well as some of the gold coast markets in Fairfield County. That said, I find it somewhat unlikely that the dynamic in Chappaqua is much different from Greenwich or Westport or New Canaan, etc. Well priced houses attract multiple bids. Everything else seems to languish for months with gradual price declines. A well priced house seems to be about 30% below the peak. That has been my experience thus far. Obviously, every situation is unique. It doesn't help that Chappaqua is a comparatively small market with fairly sparse listings of much interest under 700-800k. There are still LOTS of unrealistic sellers which can make it difficult to figure out where the market really is.
...There are still LOTS of unrealistic sellers which can make it difficult to figure out where the market really is.
The current market value is that point at which buyers' resources and expectations meets sellers' needs and expectations. From my armchair perspective it seems to me that the current market is really hard to read because on the one end there are sellers who have priced their houses above the current value at peak-ish levels, and at the other end there are truly desperate sellers who simply have to sell no matter what and have priced their houses well below the current value. And then there is the middle, with sellers who are realistic about the current value and have priced their houses well below peak but who don't need to sell and aren't willing to go lower than that. These two extremes--the unrealistically high sellers at one end and the desperate to sell at any price sellers at the other end--completely skew things. Eventually the too-high sellers will give up and the desperate sellers will sell, and then things will settle at the middle.
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