Here is the vicious circle as I see it:

The seller has a short sale and tries to get an offer to satisfy the bank. It gets delayed and the buyers bail. Then the house forecloses and sells for less than the offer was. Then the foreclosure gets a decent offer and the bank won't take it unless it is "full price".  Many lowball offers come in that are rejected or countered $2000 under the list price. The buyers bail. It sits on the market until it loses more value and ultimately sells for much less than it should have. Then that sad little sale price becomes a fair market comp which causes another neighboring house to fail the lender appraisal from the buyer trying to borrow money to buy the home. Then the neighbors house forecloses because it won't appraise for the next buyer with a bank loan. Interest rates are low, sales are up slightly but the prices still keep falling.

recent Lincoln County foreclosure This lovely home 4 bedroom 2 bath started out as a bank foreclosure listed last September for $229,000.00, I just used it as a BPO comp with a sold price of $168,900.00.  It was a very long drawn out process and took months to close.  It has single handedly pulled down the values of alot of houses in the Lincoln City area because it was a large home, relatively new and clean with granite counters. The older houses just can't compete and have more trouble appraising with this sold comp lurking in the bushes!

Please comment and let me know if this scenario fits what is happening in your neck of the woods.

Your Coastal Realtor in Oregon

 
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2 Comments on "What do you mean my house won't appraise? We are selling under market value, aren't we?"

MAY
29
2010
312,352 Points Attended Rain Camp Called Shot Master

Yes, it's diabolical isn't it.  Just doesn't make sense what the reasoning of the lenders holding these notes could be.  The destruction it causes to the industry and families is alarming.  Maybe one of the loan folks can explain it.

Sue of Robin and Sue
8:16pm • #1
MAY
31
2010
305,993 Points 4 Featured Posts Outside Blog Attended Rain Camp

Barbara, It is an unending circle of unfairness.  Some of the comps I've seen used for appraisals don't even make sense any more. 
11:22am • #2


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Barbara Le Pine - S & W Real Estate, Newport OR

Newport, OR

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S & W Real Estate, Newport, Oregon

Address: 2466 N. Coast Hwy., Newport, OR, 97365

Office Phone: (541) 265-2251

Cell Phone: (541) 270-6758

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A mix of thoughts and ideas from a full time Real Estate Broker who lives in and works in the entire Lincoln County Area, serving Lincoln City, Otis, Gleneden Beach, Depoe Bay, Otter Rock, Beverly Beach, Agate Beach, Newport, Yaquina Bay, Toledo, South Beach, Seal Rock, Waldport, Alsea, Tidewater, and Yachats.



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