Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
In conversations with realtors I'm starting to hear of deals being killed by appraisers. Seller and buyer negociate an agreeable price, below list, the house comps out just fine. Appraiser comes in and says it's overpriced by several thousand dollars even though there are comps to support it. I always thought that appraisal could be somewhat subjective and I guess it is....
I was told to expect this to start happening because banks are tightening way up. They no longer care that people agree, I'm guessing they just want to be covered if they have to take it back and the market drops more. Anyone else starting to see this? If so, how do you deal with this?
In conversations with realtors I'm starting to hear of deals being killed by appraisers. Seller and buyer negociate an agreeable price, below list, the house comps out just fine. Appraiser comes in and says it's overpriced by several thousand dollars even though there are comps to support it. I always thought that appraisal could be somewhat subjective and I guess it is....
I was told to expect this to start happening because banks are tightening way up. They no longer care that people agree, I'm guessing they just want to be covered if they have to take it back and the market drops more. Anyone else starting to see this? If so, how do you deal with this?
The appraisal process is pretty formal. It inherently runs behind the market. I have had a couple of small condo deals here recently and the appraisals were both around 5% over the agreed price. Appraisal pain is normally in a rising market rather than in a falling one.
Actually, jimj, in my market the appraisals are coming in high. In other words the appraisals based on comps aren't reflecting the hit some sellers are willing to take. It will catch up, though.
I had a client, though, who was selling in another state, and they lost their buyer because the appraisal came in over 25% below purchase price! The bozo (sorry, I don't know what you call someone that's that inept) said he "couldn't find any comps", so it sounds like instead of going beyond the mile radius to get comps (this is a semi-rural area with homes on 3/4 acre+), he just used anything that had sold in the past 6 months. The sad thing is, the buyers lost out on a great house that was priced below market value, and the sellers had to cancel their contract here, so they're back at square one. All this, because the buyer insisted on going with one of those Internet type lenders. When you don't have a local lender who knows the local market and the competent appraisers it can really be a nightmare!
Actually, jimj, in my market the appraisals are coming in high. In other words the appraisals based on comps aren't reflecting the hit some sellers are willing to take. It will catch up, though.
I had a client, though, who was selling in another state, and they lost their buyer because the appraisal came in over 25% below purchase price! The bozo (sorry, I don't know what you call someone that's that inept) said he "couldn't find any comps", so it sounds like instead of going beyond the mile radius to get comps (this is a semi-rural area with homes on 3/4 acre+), he just used anything that had sold in the past 6 months. The sad thing is, the buyers lost out on a great house that was priced below market value, and the sellers had to cancel their contract here, so they're back at square one. All this, because the buyer insisted on going with one of those Internet type lenders. When you don't have a local lender who knows the local market and the competent appraisers it can really be a nightmare!
Sounds like a great malpractice suit. And it is relatively easy to get Appraisers to testify. Your client should see a lawyer.
Sounds like a great malpractice suit. And it is relatively easy to get Appraisers to testify. Your client should see a lawyer.
Agreed, but I think they "just want to put this behind" them and move on. Hopefully, they'll be able to get another buyer soon.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The bozo (sorry, I don't know what you call someone that's that inept
) said he "couldn't find any comps", so it sounds like instead of going beyond the mile radius to get comps (this is a semi-rural area with homes on 3/4 acre+), he just used anything that had sold in the past 6 months. The sad thing is, the buyers lost out on a great house that was priced below market value, and the sellers had to cancel their contract here, so they're back at square one. All this, because the buyer insisted on going with one of those Internet type lenders. When you don't have a local lender who knows the local market and the competent appraisers it can really be a nightmare!
