Do Appraisers Have You Running Scared?

 

I heard it again yesterday from a potential seller - Appraisers are just suppressing our home values!  The word has finally reached the more informed public, there are challenges in selling the home and now the blame is being aimed at the appraisers. The thought of appraisers can bring a chill up the spine and a big gulp, will I have a valuation issue?

Finally, the difficulty of the home value challenge has shifted some from the agent onto the hurdle of the appraisal.  It use to be when I delivered the message about the value estimate of the home I would also have to enlighten the owners about what obstacles we face in our industry.  If the home is unique or there was limited data then the problem would be data and the appraiser having a challenge with the report. The word has gotten out and the concerns of this part of the home selling process have taken main focus.

There are ways to combat appraisal problems and take control. Knowing what your challenge may be on the front end will help prepare you for offers and the appraiser.

 Being prepared is the first line of defense.  This is one of the strongest tools that a listing agent can offer to their client - knowing about your home, the amenities and comparables that will be available.  Making a list of the amenities and on each comparable sale knowing what the points of difference are & how your home may offer more. 

Why are we running scared when it comes to the appraisal?  Fear of the selection of an appraiser with attitude, fear that your home value is strained and the appraiser will not value, fear that the appraiser will just look at living area and bathroom count only and not consider all the additional finishes, condition of the home.

To take a bite of the fear we have a responsibility to invest time in preparing the strongest defense of our listing's true worth.  ASSUME NOTHING .. do not assume that the appraiser has noted the extensive floor finishes, updated appliances, lot size, view amenities, etc.  You can prepare information in a non-confrontational manner by having a well prepared packet ready.  Make sure what you have prepared does meet with good comparable selection not just all sales thrown together and handed over.  Know what these sales will say when analyzed.  Write out the points of difference ... this home did not have wood floors in all the lower level like my listing, it was on a smaller site size, it is older and not as updated, etc. 

Know that the issue may not be the appraiser who we would love to pass on the blame.  The report must be prepared to meet varied guidelines, meet the test of underwriting and review, utilize sales within 6 months, etc.  With reporting restrictions, the Realtor has a responsibility to be aware before the listing is taken what situation they may face and plan for the obstacles they will face.  They need to inform the owners so there are no surprises.  They need to be cautious on the contract terms and buyer qualification. BE AWARE!

If you are a true professional then bring on the challenge - you will be ready.  If you happen to get that just awful appraiser with attitude then your next defense - get the buyer to change to a lender that has a better pool of appraisers on their round robin lists. Be ready for Plan B.