3,345,091
Oh my! If that isn't a twist on a tale of a listing agent.
Did you receive "market value" for your home? Was it in alignment with the comps we discussed?
I'm curious, if the value had come in equally low, would you be wiling to lower the price to the appraised value?
Question to you Peter Mohylsky = what comps did the appraiser use to come back with a higher value?
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Lyn Sims
Schaumburg, IL
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Peter Mohylsky, Beach ...
Miramar Beach, FL
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Nina Hollander, Broker
Charlotte, NC
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Eve Alexander
Tampa, FL
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Debe Maxwell, CRS
Charlotte, NC
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Bob "RealMan" Timm
Minot, ND
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Michael Jacobs
Pasadena, CA
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Kathleen Daniels, Prob...
San Jose, CA
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Candice A. Donofrio
Fort Mohave, AZ
5,230,068
1. Did you receive multiple Offers? Did it sell Day-0 on the market? If not, it wasn't priced too low.
2. The SELLER sets the price, not us - we are marketers. YES, we share comparables with our sellers but, they are also told that they can certainly have an appraiser's valuation to confirm our CMA.
3. EVEN if she got an appraiser's valuation, RARELY do two appraisals come in the same value. I recently had to have a second one - the first one was low. The second appraisal came in $22,000 higher than the first one.
Share those with her, Peter. It stinks when this happens but, you've got this!
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Jeff Pearl
Lovettsville, VA
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Anthony Acosta - ALLAT...
Atlanta, GA
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Tony and Suzanne Marri...
Scottsdale, AZ
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Carol Williams
Wenatchee, WA
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Steve Higgins
Kelowna, BC
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Bob "RealMan" Timm
Minot, ND
-
Kathleen Daniels, Prob...
San Jose, CA
4,572,183
The buyer pays for the appraisal and unless there is an issue(typically occurs when the appraisal does not meet the purchase price) the conversation between buyer/selling agent/buyer's lender and the seller/listing agent -- "appraisal is good".
An appraisal is an opinion of value - granted by an "expert" in the field...but you know what they say about opinions...
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Peter Mohylsky, Beach ...
Miramar Beach, FL
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Nina Hollander, Broker
Charlotte, NC
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Ron and Alexandra Seigel
Carpinteria, CA
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Debe Maxwell, CRS
Charlotte, NC
-
Steve Higgins
Kelowna, BC
-
Bob "RealMan" Timm
Minot, ND
-
Kathleen Daniels, Prob...
San Jose, CA
613,494
An appraisal is an OPINION of value. It is not science.
Give it to 3 appraisers and "opinions" will not be the same...maybe down to even less than the purchase price.
She needs to be glad someone saw value in her home.
Eve
PS: whoever gave her the appraisal was stupid...
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Marco Giancola
Miami Beach, FL
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Bob "RealMan" Timm
Minot, ND
-
Ryan Huggins - Thousan...
Thousand Oaks, CA
-
Michael Jacobs
Pasadena, CA
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Kathleen Daniels, Prob...
San Jose, CA
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Barbara Todaro
Franklin, MA
1,052,211
First I would want to SEE the appraisal.
Folks often 'read in' instead of 'reading'.
There are several methods used by the appraiser to determine value and I want to be able to understand how he derived value.
Is it in appreciating market?
What comps did the appraiser use?
HOW high is Way High? 20% 5%
Time for Jeopardy!
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Nina Hollander, Broker
Charlotte, NC
-
Steve Higgins
Kelowna, BC
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Bob "RealMan" Timm
Minot, ND
-
Kathleen Daniels, Prob...
San Jose, CA
-
Candice A. Donofrio
Fort Mohave, AZ
2,390,620
I'd be calling the appraisor and asking what he/she used for comparables Peter Mohylsky . I would show the client those comparables and mine and explain why mine were more accurate than theirs.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Anthony Acosta - ALLAT...
Atlanta, GA
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Debe Maxwell, CRS
Charlotte, NC
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Steve Higgins
Kelowna, BC
1,502,998
What idiot sends in a higher than asking appraisal to the seller? Or anything to the seller directly. It should have gone to you if anyone on the seller side.
I'm just amazed something came in well OVER asking! Usually it's at or well under. I had a house that just closed. It was in escrow twice and had two different appraisers within a week of each other. First one brought it in at asking, second $20k under. No rhyme or reason. Same SF, Bedrooms and comps.
I'd ask her how long it took to get a buyer. If it wasn't lightning fast, you're not priced low. Low prices generate (at least out here) 10+ offers in the first day, many site unseen.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Nina Hollander, Broker
Charlotte, NC
-
Debe Maxwell, CRS
Charlotte, NC
-
Bob "RealMan" Timm
Minot, ND
2,220,323
Don't know how the seller would come across an appraisal report that is paid by the buyer?????????????????
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Steve Higgins
Kelowna, BC
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Bob "RealMan" Timm
Minot, ND
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Anthony Acosta - ALLAT...
Atlanta, GA
5,104,931
This is a new one on me... I haven't seen an appraisal come in way high over a contract price in more years than I can remember. I'd tell that seller that an appraisal is one person's opinion and that another appraiser could come in and value the property below the contract price.
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Diana Zaccaro Broker A...
Cocoa Beach, FL
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Bob "RealMan" Timm
Minot, ND
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Anthony Acosta - ALLAT...
Atlanta, GA
716,049
Oh shit...
It does not matter what the explanation is. The seller now believes that he/she sold the property for too low, i.e. and came short on the proceeds. You don't want this to turn into an errors and omissions situation or negligence matter.
I would think about this VERY carefully, prepare your research, numbers, comps, analysis, againts a detailed review of the appraisal in support of your position and advice you provided. I would even suggest you consult the appraiser.
Perhaps ask a colleague, maybe two at the office to prepare independent comps reports on the property.
I would suggest Peter to get into a 'cover your a$$ mode".
This may be an overkill, but it's to better be prepared with facts and numbers and find the error(s) even if it is the appraisal that's wrong.
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Debe Maxwell, CRS
Charlotte, NC
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Steve Higgins
Kelowna, BC
-
Nina Hollander, Broker
Charlotte, NC
805,799
Debe Maxwell, CRS and Bob "RealMan" Timm both had good comments.
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Anthony Acosta - ALLAT...
Atlanta, GA
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Debe Maxwell, CRS
Charlotte, NC
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Bob "RealMan" Timm
Minot, ND
2,061,803
An appraisal is just one person's opinion of value. It rarely has anything to do with "what we could sell it for" which is often different than how the bank values it.
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
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Bob "RealMan" Timm
Minot, ND
2,684,009
Was it a local appraiser, with good comps?
If it has not closed yet, tell Seller she can consult a real estate attorney about breaking the contract. Then put the house back on market at a higher price.
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Debe Maxwell, CRS
Charlotte, NC
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Steve Higgins
Kelowna, BC
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Bob "RealMan" Timm
Minot, ND
5,583,278
as Eve said, appraising is not an exact science....there are variables.... there could be a 3 or 4% variable in our area....
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
-
Kathleen Daniels, Prob...
San Jose, CA
3,854,909
I would say we have good news. No reason to worry about the appraisal anymore. We are one step closer to moving forward!
Make it positive news.
So much better than an under appraisal!
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Debe Maxwell, CRS
Charlotte, NC
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Nina Hollander, Broker
Charlotte, NC
3,988,007
I never see the appraisals even those of my buyers. I would explain that appraisals are subjective and isn't it wonderful it came in supporting the sales price versus several thousand under. It can be a roll of the dice and create tons of problems.
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
679,404
Our job is to evaluate our current market by doing a market analysis. You can have 10 appraisers and it is not uncommon for all ten to have a different opinion and/or to come up with different price points. If we present the information to the seller and they agree to a price ... that is a concerted effort on their and our part. It's also in the eyes of the "beholder" -- the buyer. But ultimately the appraiser. So for all intents and purposes the seller agreed on the price the buyer offered. There should need to be no further discussion.
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Pete Xavier
Pacific Palisades, CA
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Debe Maxwell, CRS
Charlotte, NC
6,393,404
Really puts you in a tough position.
Was the Appraisor using Zillow?
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Bob Crane
Stevens Point, WI
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Debe Maxwell, CRS
Charlotte, NC
7,836,134
Be thankful for a high appraisal rather than a low one.
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Debe Maxwell, CRS
Charlotte, NC
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Bob "RealMan" Timm
Minot, ND
1,153,794
The evidence generally shows that the appraiser is frequently not knowledgeable about the local market. This would not have become an issue without the implementation of the Dodd-Frank Act. I have fought a few with substantial direct comparables to no avail although it does prove my valuation to the Seller. Whether low or high I cannot understand how a lender can substantiate an appraisal written from a desk 200 miles away from the subject property.
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Debe Maxwell, CRS
Charlotte, NC
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Bob "RealMan" Timm
Minot, ND
2,781,173
Appraisals are only good for a certain time and space. Secondly, another appraiser might come in low or the same. Thirdly, the idea is to get in and out of the transaction effectively and efficiently. Acts of God, market changes, economic laws, new rules and regulations etc. can take it south quickly thus get in and then get out of the market. Fourthly, you cant lose money you don't have. Fifthly, a bidding war or multiple offers would have proved the point. Lastly, it is a sticky wicket of a sort and a valid question
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Nina Hollander, Broker
Charlotte, NC
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Debe Maxwell, CRS
Charlotte, NC
1,955,212
I wrote a blog about Pricing and the answer is under positioning.
How would your client like to take it off market and put it back on market for the higher price? Probably not willing to do that! A bird in the hand.....
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Debe Maxwell, CRS
Charlotte, NC
1,725,996
Not enough info; was it a recent high sale that skewed the numbers? Bottom line; the market determines the price and it is in constant flux.
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Debe Maxwell, CRS
Charlotte, NC
5,049,183
What is WAY high? Did the property sell immediately? Lucky it was not the other way around.This is but one opinion of value. I like Kathleen Daniels ' response
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Debe Maxwell, CRS
Charlotte, NC
4,800,082
1,466,207
Peter Mohylsky I had listed a home that just wasn't selling. The seller finally agreed to reduce the price $10,000. The house sold in a couple of weeks. We were sitting at the closing table with the buyers. The closing attorney congratulated the buyers and told them what a good deal they got because the appraisal came in $10,000 over the selling price. If the seller's looks could kill, I wouldn't be here right now. It was a very uncomfortable situation. I never use that attorney again.
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Debe Maxwell, CRS
Charlotte, NC
1,844,291
I can see where that could be a problem opposite of what we normally have. Just an opinion of price & the buyers lenders version at that.
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Debe Maxwell, CRS
Charlotte, NC
599,274
Let her list it at the higher price and see what kind of action she gets. When she comes back to earth, try it again.
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Debe Maxwell, CRS
Charlotte, NC
5,216,398
Since an appraisal is an opinion, I'll stick with mine!
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Debe Maxwell, CRS
Charlotte, NC
846,475
Hey Peter-we are so used to the opposite situation so this scenario can be intense. It happened to me once and I suggested the seller get their own appraisal done as it is called "an opinion of value". They opted out and we closed at the contracted price.
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Debe Maxwell, CRS
Charlotte, NC
577,750
It's the market that sets the price, not the appraiser, not we as agents. A property is only worth what a Buyer would pay for it. If you used the appropriate comps to arrive at a listing price, then perhaps the appriaser is being a litle too optimistic, and who knows what comps he used. Appraisers aren't always right as I have found out many times.
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Debe Maxwell, CRS
Charlotte, NC
3,071,489
1,712,676
It's nice to hear about an appraisal coming in highr instead of low.
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Nina Hollander, Broker
Charlotte, NC
1,543,727
It seems suspicious that the seller got a hold of the appraisal without your knowledge. The seller chooses the price based on the market data, so while that's a natural reaction, despite the mystery, the seller chose the price and an appraisal is one person's opinion which can vary.
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Debe Maxwell, CRS
Charlotte, NC
5,772,575
Peter,
This has not happened to us, and I agree with Michael Jacobs wise words. A
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Nina Hollander, Broker
Charlotte, NC
1,239,901
What is your CMA comp in relation to the appraisal? I am good enough and my value is very different from other appraiser's value.
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Bob "RealMan" Timm
Minot, ND
4,434,127
4,319,419
5,868,544
On our listing side, the most we ever get is - it came in at contract price. Interesting your Seller got a copy?
4,936,677
113,294
As a listing agent, I always meet the appraiser at the listing and show them the most recent comps, which they always appreciate. Regarding the homeowenr, I would review the comps with her and point out (as others have said) that appraisal estimates can vary a great deal.
911,338
They agreed to the listing price when they signed the listing agreement. Appraisals are flexible values. What do the comps on the appraisal say? Are they all above the " subject" property?
634,482
I've never had that experience. A little high or a little low is what I've seen and that's not hard to explain to the parties.
900,128
921,504
That is the trap set for us when we ascribe to the "reduce the price' stategy promoted by some franchises. This seems to drive the need to create bandwidth for more transactions available with quick sales.
IN this case all the agent can do is remind the seller they were advised, while seated at their dinning room table, that a pre-inspection and appraisal was advised.
Of course the appraisal itself may be in error with comps from more favorable communities.
The real issue in a faulty appraisal case is do you remain silent and let the buyer believe they have instant equity or sound the alarm, sink the deal and have some 'splain'n' to do.
3,416,038
The seller should not receive a copy as it is the buyers, but i have had this happen, One lady who insisted we list way high, we did and no one came. It was a divorce so she wanted her agent but the court said the Mr chooses and that was me. After some time, the Mr got involved, we rduced to where it should be and got multiple offers and a sale
3,986,258