More Twists and Turns Selling Real Estate These Days! What Will Be Next?

Real Estate Broker/Owner with Homes Arizona Real Estate LLC

The real estate market in the Phoenix, Arizona and Mesa, Arizona valley is going through more twists and turns as more short sales and foreclosed homes come onto the market.

Cash is King Unfortunately, many buyers are competing against cash buyers – and losing.  The old saying, “cash is king” is true in this competitive  real estate market.

Recently one of my buyers made an offer on a foreclosed property. Over asking price, very clean, and a desirable offer to any potential seller. However, the buyer lost out to a cash buyer even though the cash buyer offered less. Even the REO agent wanted my buyer to get the home, but has no say!

Why? You might ask? Would the bank accept a cashlower offer? In our market, appraisals are all over the place. As of May 1, in order to “fix” or “remedy” the problem, a new federal Home Valuation Code of Conduct  was placed into effect. No longer are the lenders allowed to speak with the appraisers – nor are they allowed to “choose” or "select" the appraisers they know to be reputable, savvy, and aware of the market in which the property is located. Bottom line? It’s a mess!

The left hand doesn’t know what the right is doing, homes are not appraising, and there are multiple bids on the most desirable homes.

cash In spite of these issues we face, Realtors will continue to push through the paperwork, the difficult appraisals, and we will write two, three, four and more offers in order to get our buyers a home. Ridiculous? Yes!! BUT, this, too, shall pass! Maybe, just maybe, we'll get a seller, a seller's agent, a good appraisal, and close on a home like we did in years' past. Could happen!

For more insight and understanding about what’s going on with the new appraisal process, click on the links here and here.

Mesa, Arizona Real Estate. Call me at: 480.216-3334 for information on purchasing or selling a home in Mesa, Arizona or surrounding towns. OR email me: Feel free to visit one of my websites:, ServingMesaArizona, or Or stop by my blogs at: MesaAzRealEstateVoice; or Phoenix Valley Real Estate Blog

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Lynda Eisenmann
Preferred Home Brokers - Brea, CA
Broker-Owner,CRS,CDPE,GRI,SRES, Brea,CA, Orange Co

Hi Teri,

You're so right, we're seeing all cash buyers beating out other buyers. Appraisals and the "SPEED" of a timely closing has become paramount to many REO sellers.

No doubt the "new" appraisal guidelines were meant to help home buyers...sorry to say like other programs in some areas it doesn't seem to be helping.

May 26, 2009 04:49 PM #1
Melina Tomson
Tomson Burnham, llc Licensed in the State of Oregon - Salem, OR
Principal Broker/Owner, M.S.

We have that dynamic here to, except I had the cash buyer.  The listing agent was just as stunned as yours was.

May 26, 2009 04:53 PM #2
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude - Carlsbad

Teri - yep, hearing about, adn seeing, this same pattern play out here. It is frustrating for many buyers who are qualified and want to buy. Folks are hoping for more REOs since the "regular" inventory isn't changing much. And we are also seeing appraisal issues - just had one myself.


May 26, 2009 05:50 PM #3
Janna Scharf
Keller Williams Realty Coeur d'Alene - Coeur d'Alene, ID
Coeur d'Alene Idaho Real Estate Expert

You're right, it sure COULD happen, but it's not the norm at this point in time.  Writing up TWO offers in the morning with the same buyer.  Like you said, it's taking more and more attempts to get one good, prospective buyer into a house right now!

May 26, 2009 05:54 PM #4
Respect Realty LLC
Respect Realty LLC - Milwaukie, OR
Brokers - Oregon / SW Washington Real Estate

I have my own appraisal horror story coming online in the next couple days. I will post once the deal closes, but wow, this new law is not good for anyone involved but the appraisers.

Todd Clark -

May 26, 2009 06:08 PM #5
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

Teri, the same thing happened to us last year, we bid 30K over a property, cash.

They took an offer below asking price.


The other had no inspection and we had ONE on the drainfield. Which had to be done anyway according to the Washtenaw County Health Regulations.

Yes, the listing agent was shocked too.

Banks are stupid.

May 26, 2009 11:15 PM #6
Laura Gray
RE/MAX Realty Group - Gaithersburg, MD

Teri - we are seeing it more and more in our area. The latest trick is for the Listing agent to put in the comments "CASH or Renovation loan only" in the remarks section, this is preventing many buyers from ever seeing or making offers on the property. The condition may be fine , but everyone from the agent to the bank wants a quick clean settlement,

May 27, 2009 01:35 AM #7
Fred Carver Personal Real Estate Corporation
RE/MAX Camosun Victoria BC Real Estate - Victoria, BC
Accredited Real Estate Consultant

Hey Terri... . Bummmer, sorry you lost out :O(, Next time is your turn and I hope it's a big one, Thanks for sharing your story

May 27, 2009 03:51 AM #8
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Sounds like a real mess to me. Hopefully they get the appraisal guidelines corrected!

May 27, 2009 09:01 AM #9
Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents
Lyon Real Estate - Sacramento, CA
Put 40 years of experience to work for you

Same problem in Sacramento, too. The only saving grace is short sale banks don't seem to care much about cash, and the sellers of short sales don't care at all. So cash is not king on a short sale. Getting the highest price is paramount and a price that an appraiser will accept.

May 27, 2009 10:12 AM #10
Lori Churchill Cofer
Beasley Realty - Pullman, WA
Realtor - 509-330-0086 - Pullman, WA


I am with Bill...sounds like a terrible mess...oh for better days!

May 27, 2009 02:46 PM #11
Mary Fasnacht
Washington and Allegheny Counties and surrounding areas - McMurray, PA
Feels Like Home Interiors ~ Pittsburgh PA Home Staging

Teri, what a pain!  These issues just keep getting bigger and bigger.  A seller can only get a little excited these days when they have an offer.  They better not pop the cork on that champagne until the appraisal comes through.  And now strong buyers have worry they'll lose out to lower offers.  It's a crazy time for sure.  Hang in there.

May 28, 2009 12:54 AM #12
Karen Kruschka
RE/MAX Executives - Woodbridge, VA
- "My Experience Isn't Expensive - It's PRICELESS"

Teri  The concern here is that the cash buyers will eventually start the cycle all over again of "pump it up"  - they will begint og bid above anyone else Karen

May 28, 2009 01:27 AM #13
Carol Lee
Dilbeck Real Estate - Oak Park, CA
Realtor - Agoura, Oak Park, Westlake CA Homes

Cash may be king, but I have had cash buyers make (or want to make) ridiculous offers because they are all cash.  So what, so are a lot of others.

Regarding the appraisals, the intention may be there, but the reality is that sometimes we need to be able to communicate to the appraiser, and explain certain facts that may not be available on the MLS.

And people think we don't earn our salaries?  Ha!

Jun 04, 2009 01:25 PM #14
Craig Chapman
Call Realty / Access Appraisals - Mesa, AZ
The Value Guy

Here is an interesting note for you all about the HVCC that everyone is screeming about.  It DOES NOT APPLY TO FHA LOANS.  That is right, if your sale is a FHA loan the lender can still pick their appraiser & talk to them.  kool.  So if your buyers loan is with in the FHA limits, it may be advisable to consider a FHA loan.  It may help solve some of the potential problems that could arise with using a conventional loan under the HVCC.  

Good luck

Craig Chapman - the value guy    I'm a sales agent & a certified appraiser & see both sides of these issues.  Feel free to contact me with any questions.


Aug 03, 2009 03:25 PM #15
Kyle Jan
Scottsdale, AZ
Phoenix AZ Homes for Sale

Craig is right as of today, but FHA announced on friday that it will stop allowing FHA appraisals to be ordered directly by brokers and correspondents as of 1/1/2010, so there will be issues there also.  They will also be ordered by someone other than the locals who have a better more realistic understanding of the market.  Use FHA while you still can. 

Sep 21, 2009 06:33 AM #16
Pat Kady
Keller Williams Check Realty - Prescott, AZ

Hi Teri,

Our market here in Prescott is similar ..Oh for the good old days


Feb 24, 2010 01:57 PM #17
Craig Chapman
Call Realty / Access Appraisals - Mesa, AZ
The Value Guy

Yes, Fha did change to the HVCC.  However, what most lenders don't seem to understand is that the HVCC does not mean they have to use an appraisal management company AMC who typically send appraisers out from all over to all over for low pay.  Since the HVCC has gone into action, the AMCs have seized about of 80% of all appraisal work in the country, away from a lot of good appraisers who had worked for years developing those clients & business.  There are HVCC compliant ways for lenders to order appraisals through companies like Mercury Network which is not a AMC.  They have a huge network of appraisers & don't jack the appraisal fee way up like many AMCs do.  The appraiser gets his normal fee for his regular area of coverage.  They order on a rotation, but my understanding is that a lender can choose a number of appraisers they know to be reliable to have on their own rotation list.  So when they order a appraisal, instead of getting some stranger, even though they would not know the exact appraiser being selected for that appraisal, they would know it was one of the ones they had in the system.  I just heard of this & need to check it out, but this could begin to change things a bit.  Tell your lenders to check out the Mercury system, it costs them nothing & could start to solve some of their appraisal problems.

Apr 02, 2010 07:37 AM #18
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