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Archive for August, 2012

Reasons Your Oakland County MI Appraisal May Come In Low

Low appraisals are probably the biggest killer of sales of non distressed homes in the North Oakland County area. There are many reasons for a low appraised value that have absolutely nothing to do with the actual value of the house being appraised. Below is a short list of reasons why a house may appraise low:

  • Lack of comparable sales
  • Out of the area appraiser
  • Bad appraiser
  • The amount of distressed sales in the area
  • Restrictions on adjustments

The problem with the list above is there isn’t much that can be done to change those scenarios.

Things to keep in mind if your appraisal comes in low:

  • The seller DOES NOT have to reduce their price to match the appraised value
  • Appraised value is just an opinion and does not necessarily reflect the true value of the house
  • The appraiser DOES NOT work for you
  • Your loan officer doesn’t really work for you. He/she has a duty to the lender/investor they sell the loan to
  • Appraised value and market value can be two totally different dollar amounts
  • Since about 20% of area sales are cash, market value will more than likely trump appraised value

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Jackie Hawley

(248) 736-6407

Jackie@JackieHawley.com

www.JHawleyAndAssociates.com

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If the appraisal is low the seller should come down? So if the appraisal is high the buyer should come up in price?

I recently had an appraisal come in low – way low- on a transaction where I represent the buyer. Way low translates into $74K low. The seller was asking $429,900. We negotiated a price of $404,000 and the appraisal came in at $330,000.

There are various reasons the first appraisal came in low but just trust me that the value was there and the buyers were getting a terrific deal. But the reasons for the low appraisal are not the subject of this post.

So my mom was at the bookstore during all this and was telling the lady there about the low appraisal and the book store lady immediately said “Of course the seller is coming down…”

But when someone brags that their new house appraised above the sale price nobody ever exclaims “So you increased your offer, right?”

Why is it assumed that a seller should give up thousands of dollars based on the opinion of one stranger?

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Jackie Hawley, Realtor
Cell: (248)736-6407

Jackie@JackieHawley.com

www.JHawleyAndAssociates.com

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