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Conservative Appraisals Rattle Buyers
I recently sold a foreclosure in a gated community in the North Atlanta suburbs. It was the lowest price home (low $400,000s) in a neighborhood with homes up to $2 million. It was a great deal and in wonderful shape. My buyers were very excited until we got the appraisal and then they were upset because the appraisal came in at the price we had negotiated for the property which was the list price. (Keep in mind this was a competitive bid situation with more than 10 offers in 3 days) They kept saying to me "We are paying market price for this home because we are paying the appraised value instead of getting a great discount!" The extremely conservative appraisal that surprised both myself and the listing agent caused the buyers to think twice about buying the property. I understand why these appraisals are so conservative right now- the same reason it is difficult to get a loan.(Of course I explained this to my buyer but they still weren't that happy!). Many appraisers were blamed for overinflated values and they are not sticking their necks out now! I know that as the market improves loans will be easier to get, ... more
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