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Old 03-16-2021, 12:12 PM
 
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Do potential buyers ( in this case, a municipality) often order an appraisal instead of asking the owner for numbers?
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Old 03-16-2021, 01:00 PM
 
Location: Columbia, SC
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Quote:
Originally Posted by GGD... View Post
Do potential buyers ( in this case, a municipality) often order an appraisal instead of asking the owner for numbers?
If there is a loan involved the lender requires an appraisal and they order through a 3rd party company. If it's a cash sale the buyer usually forgoes the appraisal but if it's a municipality they may get one to make sure their offer is in line with value.
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Old 03-16-2021, 04:50 PM
 
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If a government entity is purchasing property, they will often simply order an appraisal and then offer the appraised amount. They may or may not negotiate from the appraised amount. Some do and some only very rarely will negotiate a higher amount. I've worked with governmental units that do both but they usually try to stick to the appraised value. (I've noticed that this practice sometimes results in them paying more than they would need to pay in a regular arms-length transaction.)
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Old 03-17-2021, 09:13 AM
 
Location: East of Seattle since 1992, originally from SF Bay Area
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Keep in mind that in many cases government agencies have the power of eminent domain, used in cases such as expansion of light rail, or widening a freeway. The law requires "just compensation" to the owner, which a city might consider to be the result of an appraisal. For the homeowner, getting their own appraisals and even hiring an attorney could result in a more favorable reimbursement. Appraisals are meant to ensure that a lender is taking an appropriate level of risk, while as we know, a home might sell for much more or much less, depending on other factors. Here, for example, homes are selling with multiple offers over asking and may not appraise, but people have enough down payment to get the loans. The public agency is not likely to pay that much.
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Old 03-17-2021, 10:42 AM
 
Location: Bloomington IN
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States have laws about land purchases by government entities. There may even be local laws that govern these transactions. Over the past 10 years or so there have been 100's of state land purchases for a new highway in my state. I've followed local news reporting about the process, etc. and have learned a few things. In my state the state always orders an appraisal to determine fair market value before sending the offer to the owner. The owner can disagree with that value and negotiate, but the state is limited in what they can pay based on law.
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Old 03-17-2021, 05:48 PM
 
Location: Raleigh NC
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Quote:
Originally Posted by GGD... View Post
Do potential buyers ( in this case, a municipality) often order an appraisal instead of asking the owner for numbers?
yes, always. Unless you're a high roller in a small town maybe

You might do well to read up on the process in your municipality, to see whether it's of any value to get your own appraisal as well, in case theirs comes in very low.
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