Here is what I see in the Tracy and Mountain House, CA housing market.
We have 90% of the homes for sale in our market are distressed, either short sale or foreclosed homes. In order to capture the buyers homes are coming on the market priced lower and lower every day.
Once the property is on the market, the home gets multiple offers and sells for over asking.
Then for the appraisal -- the home doesn't appraise, because everything else is priced lower.
Example:
Home Priced at $210,000
Price accepted $221,000
Appraised at $208,000 -- the bank sells the property for $208,000.
We are now in a situation when short sale clients are calling appraisers hoping for a property to appraise as low as possible, and REO properties not being able to appraise any higer than the list price.
So where does the spin stop?
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