But it has to be worth that!

By
Real Estate Agent with Atlanta Communities 303302

Well, your house is under contract. Took all of a day and you accepted an offer $25,000 above your asking price. Pretty sweet, right? Also negotiated short due diligence times and did not have to give up anything. This surely must be heaven. What could go wrong?

If the buyer is getting a loan to purchase your home, or even some cash deals require this, its an appraisal. This is when an appraiser comes out, looks over your home, and calculates what he believes to be a fair price for the home. If this value is below the sales price, the buyer will have to come out of pocket with cash they might not have to make up the difference between the sales price and the lower appraisal value. Or, more often, they will ask the seller to lower their purchase price to the appraisal value.

I have been seeing recently that appraisers are not allowing these super inflated sales price to go through. The lenders are apparently asking the appraisers to not add in value based on the hot market as they were doing earlier. More and more deals are coming up short due to low appraisal values.

So, before you list your home at a price way above what the going values are, remember, you might still get multiple offers at crazy high prices, but the appraisers will shoot down values that cannot be supported by comps.

To learn more about pricing your home for sale, give us a call.

Posted by

Peter den Boer, Associate Broker, Realtor

Atlanta Communities Real estate Brokerage

 

Ph. 770.713.1545

www.denboerhomes.com

 

I write about daily life as a Realtor in the Towne Lake Community in Woodstock Georgia.

Comments (3)

Brian England
Vacasa - Gilbert, AZ
MBA, GRI, REALTOR® Real Estate in East Valley AZ

It seems crazy to me that an appraiser would not be allowed to factor in how hot the market is.

Apr 27, 2021 05:41 AM
Ed Silva
Mapleridge Realty, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

 hd n issue with some offers on a small property that I recently listed. Some over $30,000 asking and the house was listed under $200,000.  We threw them out as we did not want to have an issue with appraisal and it was confirmed with appraisal that came in $14,000 over asking. Appraiser should not be considering the hot market but do their job based on comparables that closed period.

Apr 27, 2021 05:56 AM
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Peter,

Neither Ron nor I would buy or sell a home under these conditions.  At some point, there will a pendulum swing.  I have seen it happen twice in commercial real estate, and once in residential...A

Apr 27, 2021 07:47 AM