Question for the realtors

[BP in ME]

We listed our house and put it under contract within days. When pricing, the realtor suggested a price based on comps and said she was worried about going any higher because appraisals seemed to be coming in a little low almost as though banks might be pressuring the appraisers to keep prices down. There also aren't a lot of sales for comps because people don't like moving in the middle of winter.

I looked at the competition and based on that, we decided to go approx 5% higher. First offer was a cash sale 1% below ask. We didn't negotiate, we waited for the results of the scheduled showings. The next two offers were standard financed purchase at 2% over ask. We chose one and things moved forward. The appraisal came back right where the realtor suggested listing (5% under list).

How in the hell can someone tell me the market value of our house isn't at least 3-4% higher than the appraisal if the first three buyers to look at it all agreed that it is? The old saying is that something is only worth what someone is willing to pay and we have multiple people willing to pay.

[TritonJT]

We listed our house and put it under contract within days. When pricing, the realtor suggested a price based on comps and said she was worried about going any higher because appraisals seemed to be coming in a little low almost as though banks might be pressuring the appraisers to keep prices down. There also aren't a lot of sales for comps because people don't like moving in the middle of winter.

I looked at the competition and based on that, we decided to go approx 5% higher. First offer was a cash sale 1% below ask. We didn't negotiate, we waited for the results of the scheduled showings. The next two offers were standard financed purchase at 2% over ask. We chose one and things moved forward. The appraisal came back right where the realtor suggested listing (5% under list).

How in the hell can someone tell me the market value of our house isn't at least 3-4% higher than the appraisal if the first three buyers to look at it all agreed that it is? The old saying is that something is only worth what someone is willing to pay and we have multiple people willing to pay.

It doesn't matter what someone is willing to pay for a bank. They want an appraisal based on previously sold houses comparable to your house in the near vicinity.

[BP in ME]

It doesn't matter what someone is willing to pay for a bank. They want an appraisal based on previously sold houses comparable to your house in the near vicinity.

If that's the case then real estate values would never go up unless buyers pay cash or make up the difference in cash.

[Bass in the grass]

It’s just the bank covering their own butts, appraisals are almost always right at the contract price. Every now and then, you’ll get an out of area appraiser and they can really screw you. Your realtor played it safe for a fast commission for themselves.

*disclaimer, I’m not a realtor, but my wife runs a title company.

[BP in ME]

It’s just the bank covering their own butts, appraisals are almost always right at the contract price. Every now and then, you’ll get an out of area appraiser and they can really screw you. Your realtor played it safe for a fast commission for themselves.

*disclaimer, I’m not a realtor, but my wife runs a title company.

That's a loaded statement. The appraisal is supposed to be the market value as determined by an independent 3rd party.

*Full disclosure: I'm a former realtor myself so I have some idea of how the game is played and that 5% could buy a bunch of goodies for my boat

[T. Hill]

So how much do you feel you left on the table?

[BP in ME]

So how much do you feel you left on the table?

Since this is still a valid contract, I'd rather not disclose that

[geodebasser]

I remember my neighbor said. I sold my lake house for too little even though it appraised right at where I sold it for. I didn’t use a realtor and save a bunch in commission. Then my neighbor lists his house for a half million more than mine. It’s been on the market going on three years. Could I have sold it for more , maybe but if it sat for two or three years I would be maintaining it, paying taxes and insurance . In addition by having to wait two or three years the house that I would buy to replace it would have gone up and cost more. Don’t beat yourself up because the alternative could be an overpriced house that just sits.

[bnt55]

You would have been better off taking the cash offer...no banks, no appraisal

[Lightning 6]

Appraisal doesn’t determine your selling price (for conventional loans) ….. it affects the LTV that a lender will offer the buyer.

That being said, it does provide a good estimate of market value…..eventhough market conditions can drive market value above or below appraisal.

[Bass in the grass]

That's a loaded statement. The appraisal is supposed to be the market value as determined by an independent 3rd party.

*Full disclosure: I'm a former realtor myself so I have some idea of how the game is played and that 5% could buy a bunch of goodies for my boat

If you were a realtor, then you know who the appraiser works for & gets paid by. They aren’t there to help you, the only person on your side in the entire transaction will be the selling agent. Inspectors are against you, buyer is against you, bank, appraiser, all go for the buyer.

Three contracts that quickly show you are in a hot market, you under priced and that’s on your realtor. But the banks “comps” BS can bite you as well.

[Grizzly]

The strategy I am seeing here at the lake is price it real high, more than you would ever expect to get, then drop it. It seems to be working.

[ECobb91]

The appraisals are for the bank and property taxes. It’s my understanding that You can’t get a mortgage for more than what the house is appraised for. Anything over needs to be paid from a different fund source (separate personal loan, cash, etc). It’s the banks way of protecting themselves because it’ll be foolish to give a loan for more than what anything is worth. Just because someone overpays, doesn’t mean that’s the true value of that item. Just means that person was willing to overpay.

That appraisal is also what the property taxes are based on. Speaking with hyperbole: Would those who brag about selling their house for hundreds of thousands over asking really want their appraisal to be that amount? My guess is no, because then they’d complain their yearly taxes are raised by an exponential amount.

like all aspects, sellers think what they have is gold, buyers only want to pay for lead.

[BP in ME]

The appraisals are for the bank and property taxes. It’s my understanding that You can’t get a mortgage for more than what the house is appraised for. Anything over needs to be paid from a different fund source (separate personal loan, cash, etc). It’s the banks way of protecting themselves because it’ll be foolish to give a loan for more than what anything is worth. Just because someone overpays, doesn’t mean that’s the true value of that item. Just means that person was willing to overpay.

That appraisal is also what the property taxes are based on. Speaking with hyperbole: Would those who brag about selling their house for hundreds of thousands over asking really want their appraisal to be that amount? My guess is no, because then they’d complain their yearly taxes are raised by an exponential amount.

like all aspects, sellers think what they have is gold, buyers only want to pay for lead.

The appraisal and the assessed value are different even though towns often hire the same people using the same process to determine the value. It often depends how often the town does valuations. It's a good thing our has stayed steady since we bought it. Mil rate is 19.25 so that would take a chunk.

I've had a bunch of people tell me they're surprised we aren't asking more. 3100 sq ft contemporary on 25 AC of mature forest and pasture. Private setting 500' ft off quiet road. 1 mile off the highway in a bedroom community for Bangor execs, doctors, etc. Horse friendly with several hundred yards frontage on a canoe-able stream that has trout in the spring and crappie, perch, and bass in the summer months. Class IV whitewater 200 yards from the driveway. Hunt deer, turkey, bunnies, partridge, and ducks right off the back deck. I'd stay if it wasn't for divorce. People want this house so I'm pissed that the appraiser is saying, "yeah, it's not worth that much even though people are willing to pay it."

[jbassman87]

It sounds to me the buyer has them in their pockets and are trying to get a deal out of you. They will then try and resale at a higher margin for a profit. Might even have another buyer already lined up.

[BP in ME]

It sounds to me the buyer has them in their pockets and are trying to get a deal out of you. They will then try and resale at a higher margin for a profit. Might even have another buyer already lined up.

I don't think so. If what we know about them is true, then they are just a young family looking for a new home due to relocating for his work. My ex looked up their current home an hour away and it's a very similar style and setting. The rumor is that local lenders are leaning on appraisers to keep prices down.

[Bigrod]

That is the buyers problem. They still owe you the contract price if they still want to buy the home it’s just the bank won’t loan them the extra. Now, if you demand the contract price and they only want todo appraised price then they have a legal contract dispute and can declare the contract null and void.

[jbassman87]

I don't think so. If what we know about them is true, then they are just a young family looking for a new home due to relocating for his work. My ex looked up their current home an hour away and it's a very similar style and setting. The rumor is that local lenders are leaning on appraisers to keep prices down.

Hope that is the case.

Maybe the days of an appraiser asking what they need it to appraise for are over? In KC, I know that the some appraisers were asking the realtors what they needed and miraculously that is what it appraised for.

[paul40269]

So you priced 5% above the comps/competition and your appraisal came in 5% under that? Sounds like you are selling your house for exactly what the bank thinks it's worth.

The problem is a person with a mortgage pre-approval can/will bid all they want, but it's the bank who decides what the house is worth to them in order to issue a mortgage.

[ECobb91]

The appraisal and the assessed value are different even though towns often hire the same people using the same process to determine the value. It often depends how often the town does valuations. It's a good thing our has stayed steady since we bought it. Mil rate is 19.25 so that would take a chunk.

I've had a bunch of people tell me they're surprised we aren't asking more. 3100 sq ft contemporary on 25 AC of mature forest and pasture. Private setting 500' ft off quiet road. 1 mile off the highway in a bedroom community for Bangor execs, doctors, etc. Horse friendly with several hundred yards frontage on a canoe-able stream that has trout in the spring and crappie, perch, and bass in the summer months. Class IV whitewater 200 yards from the driveway. Hunt deer, turkey, bunnies, partridge, and ducks right off the back deck. I'd stay if it wasn't for divorce. People want this house so I'm pissed that the appraiser is saying, "yeah, it's not worth that much even though people are willing to pay it."

It sounds like paradise imo. Especially if they’re Brookies. I wasn’t trying to be argumentative, rather just providing a viewpoint from an outside perspective.

is there a chance you can get it reassessed? If you and your ex wife are on good terms, and willing to drag it out a couple months it might be worth while.

My parents are in the process of selling theirs and it’s a similar situation to you, rather much less property. 1800sf house with in the mountains, 35min to the closest large town/city, 30 the lakes and tourist towns in the Adirondacks. Has lake access with dock rights, brook trout streams within 10min, and just in a very desirable area. They thought it would be appraised for 200k, the realtor set it at 150k and it was appraised for less than asking. They were truly unhappy with that price and their realtor suggested a reappraisal but time wasn’t on their side. They accepted a full asking price offer, sight unseen. If the house was 30min north, it would be 350k asking.