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In a conundrum, I put my apartment on the market at 310, got a contract signed after 3 days on the market. The appraisal came in this week at 300K, and based on the buyers agent and the comps, they're not willing to go to 310. Fine, I asked my agent to lower it to 305. It's still above appraisal, I don't know how likely it is that he's willing to go an extra 5K either in cash or getting extra financing but the guy has to move out of his place in two weeks. If this fell through, I doubt he'll be able to find another place and close in 17 days seeing as how this has taken close to a month.
I'm waiting to hear back, but its unclear who has the leverage here. I don't have to sell right now, but my fear is what's to come after. If I put it on the market again, how much longer would it take. Would another appraisal come in at the same price or lower, would I have to put it on the market at a lower price etc. I hate to be greedy, I feel like I'm emotionally invested hence why I'm being a little stubborn. And 10K is a nice chunk of change that I'm leaving on the table. What to do what to do?
The contract is signed at 310 right. Negotiation time is over. Did they make a good faith deposit that will be held in escrow by your agent? The buyers could lose that. Was there something in the contract that allows them to wiggle out if the appraisal doesn't come up to the asking price? Usually a contract is contingent on them being able obtain financing based on an appraisal and a satisfactory home inspection.
What's missing here?
Why is the price still an issue?
I know the rules have changed since 2008, so does the bank require 100% appraisal?
My agent sent comps, they were reviewed by the buyer and his agent and based on the information they had, they couldn't justify going to 310. In addition, the other units had extra amenities such as a parking spot or extra storage down in the basement. My unit has neither. Hence why we're at $302,500, which is basically the split between 305 and 300. Leaning towards taking it, have to sleep on it, but I'm feeling that I'm "losing" in this deal, even though I'm getting above the appraised price but not the 305 or 310 that I wanted. At what point am I being greedy
What state are you in? A contract was signed at 310. It's now their turn to $hit or get off of the pot.
They have that apartment tied up in contract. Depending upon the law in your state you may be able to keep the deposit.
Please explain why the buyer is not bound by the signed contract?
one word: Contingencies!
Any real estate professional would have included contingencies in the contract to include things like inspection, financing, appraisals, and condo/coop board approval..
The ball has been thrown back in your lap. The appraisal says you are overpriced so the contract is not enforceable, as the contract will have financing continuances, that makes the contract null and void. You have just two choices to make.
1: Sell at the lower price, and be done with it, as the appraisal says you are overpriced no matter what you think the price should be.
2: Let the contract expire and let the buyer get their earnest money back. Then place it on the market again, and probably repeat the the same thing happening again, and again. The word will have spread throughout the Realtors in your area, that the sale fell through due to the appraisal killing the sale, and they will not be working hard to sell your property and find they have wasted time on a property that the owner wants more than they can get it financed for. They will spend their time on properties they think they can sell and close the sale. If they bring offers, they will be at $300K or below as that is the type of agent that will work on the property.
That is the facts of the real estate brokerage business. For only $10,000 difference you would be foolish to only consider #2 solution.
Presumably by now you've reached a decision. As a former real estate agent who worked in a declining market where appraisals frequently came in lower than the offer price, I would tell you to take the appraised price unless you are comfortable staying where you are for an indefinite period of time. I say indefinite because no one knows when the market might reach your desired sale price. Ask yourself this, would you pay a seller more than the appraised value for a home? Most people, even those flush with cash will not. Forget your feelings or any emotional whatever, this is bricks and mortar we're talking about.
I also read that your unit not only is a studio vs. a 1 bedroom, but the floors were redone in the upper level unit, and your unit is lacking parking that other comparable units in your building have. What more is there to say? Parking in most cities is worth a pile of dough, and although it might not have been a big issue for you to not have that parking, the appraiser is going to give it a price tag, along with the wall that creates a bedroom, and the new flooring in the "upper" unit.
Bigger issues here are whether or not you'll run away with enough cash to pursue whatever endeavors you had in mind. But even this is not enough of an argument to not take the deal, because you should never count your chickens until they've hatched. If the buyer is willing to give you anything over the appraised value consider that a gift, because it is just that.
I saw mentions on here about how buyers in the $300K price range can certainly afford to come in with more cash. Not necessarily and don't assume that. They have to have cash for closing costs, likely to be close to $12K, and whatever they are putting down. They could already be stretched to the max. But still, why should they pay more than the appraised value?
I'm sorry it didn't go smoother for you and when you have your hopes up to obtain a certain figure, it stinks to have to let go of that figure, but I will tell you that more than likely it will cost you more in the long run to not take the deal, unless, like I said you are comfortable staying there an indefinite period of time. No idea what's going on in your market, but I would venture to say it's not especially hot or the appraiser would have fattened it up to the offer price.
Several posts ago the OP wrote that he had accepted the offer of 302500.
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