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Thread: Should I get my house appraised before selling?

  1. #1
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    Should I get my house appraised before selling?

    So, long story short:

    -- I'm a financial/real estate idoit.
    -- Several months ago we talked to a realtor about selling our house. We elected not to for several reasons.
    -- That realtor had suggested a listing price lower than we had been expecting, although I don't think it was necessarily unreasonable.
    -- Things change, and now we are interested in selling again.

    My question for the Shagverse is whether there is a good argument for or against my getting an appraisal on our house before we put it up for sale.

    Advantages I see:
    1) I (hopefully) would get a relatively unbiased/realistic assessment, not worrying about whether the realtor has an incentive to either sell quickly or hold out for a bigger commission (I have trust issues).
    2) OK, I can't think of another one.

    Possible disadvantages I wonder about:
    1) The more I see of this stuff, the more I wonder how much of an assessment is pulled out of appraiser's ass to help a sale go through (within reason).
    2) I certainly understand that an appraisal =/= what somebody will pay, so is it even that useful of a reference point?
    3) If I get an appraisal done, does it "stick" for a certain period of time? My concern would be that, if say we were to be able to sell for higher than our appraisal (in my fantasy world of unicorns and gumdrops), could that lower appraisal cause a problem at closing?
    4) That's 400 bucks I could spend on beer.

    Thanks for your help. As you can see, I'm a big dummy.

  2. #2
    asshat Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68 might be a clever chap. or know the right people. know what i mean, nudge nudge? Longhorn_Fan68's Avatar
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    i don't think an appraisal has much to do with the sales price other than the buyer will have one done and if it comes back way lower than you're asking they'll probably pull out of the deal. At least if you get one you'll have a place to start.

  3. #3
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    don't bother as there are no positives..

    1. a lot of appraisers are $#@!ing clueless and do a $#@!ty job... for example, I was looking at doing a cash out refi and the $#@!ing appraiser was from the burbs and valued my house at appraisal district levels.. .about $350k.... I sold the house a month later for $427k...
    2. since I didn't order that appraisal (the bank did), I didn't have to disclose it... you might have to disclose an appraisal you order and if you get a dumb$#@! like I had it could hurt you..
    3. all lenders for whomever buys your house will require an independent appraisal anyway, so why bother doing it yourself?

    talk to people and get referrals for realtors.. if you are in Houston I can send you a badass.... have 3 of them come by your house to meet you and look at your property... get all of them to put together comps and a suggested sales strategy for your home... decide which one you trust most and feel will best represent your interests and fight for you.. .DO NOT automatically sign with the chump who gives you the highest listing price because that isn't necessarily rooted in reality and they are likely preying on your emotions to make you think they can get you more $$...

    there is a lot more I can get in to with regards to selling strategy... but I'll save that for another day... some dip$#@! dropping a sign in your yard and putting your house on the MLS isn't selling your home.. you need to have a concise strategy regarding pricing and to do so you'll have to be open and honest with them... then of course there is marketing collateral, but truly a properly priced house will sell, and quickly... my house sold in 6 days and for exactly what I wanted for it... I'm only 33 but I've bought/sold 6 houses now both as a homeowner and property flipper.. and my wife was a realtor for a while too..

  4. #4
    Certified Residential Appraiser here...............

    I'm speaking as a Shaggy degenerate, not as an appraiser, nor is this appraisal advice.
    Yeah, some Fee Appraisers are $#@!ing clueless. But even more realtors are even more $#@!ing clueless when it comes to estimating the value of a home.

    First off, I highly doubt the appraisal fee will be $400. Long story short, thanks to a bunch of idiot politicians in DC with admittedly good intentions of trying to create separation between appraisers and lenders and prevent undue influence and ensure appraisers get fair compensation, they $#@!ed things up and instead, the lenders control the lending/appraisal process, lenders can freely influence appraisals, and appraisal fees are at an all time low, to the point that good veteran appraisers have had to bail from the profession. (/soapbox)

    So that $400 appraisal fee may be $150 now. Plenty 'o' cash left to spend on beer.

    It's not pulling numbers out of our ass, it should be adjustments and estimates based on what the market and individual sales indicate. (ie: two identical floorplans, same neighborhood, same year built, condition, quality, etc, both 3BR/2.5 bath, one sells for $100K without pool, the other sells for $106,000 with pool. How much does the pool contribute? 6K. That's not pulling numbers out ass. Granted, some adjustments are based on appraiser experience, so they may look like they were pulled/ass.

    The appraiser is hired by you. You pay him. I can't deny that he may try to hit a number that pleases you (as long as it is supported and reasonable) SO YOU WON'T STIFF HIM ON THE FEE.

    As far as sticking.........a good appraisal is good as long as the market doesn't change and the appraisal, as of a certain date, still reflects market conditions. If the market changes, then the appraisal no longer relects the current market. But yeah, the older the appraisal gets, the less convincing.

    At closing, a lower appraisal will only be an issue if you reveal that there is an appraisal with a lower value. You paid for it, its yours, you control it.

    I don't know if you need an appraisal. Just get the MLS listing for the most recent comparable sales, and all the comparable active listings which you will be competing against. And by comparable, I mean don't compare your 1500/sf home to 5,000/sf homes. Keep them close, +/- 250/sf smaller or larger, simialar age, condition class etc. Let it soak in, don't need an appraiser to see what the range of plausible values may be.
    Last edited by To be named later; 05-03-2011 at 11:21 PM.

  5. #5
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    not sure where you (or the house in question is located) but the easiest way to approach a selling point is to get comps for your area. That can mean hiring a realtor or finding another method/person to pull the comps for you. Even then your house is worth what someone will pay for it, not what your neighbor got 2 months ago.

    I am far far far from an expert but we FINALLY sold our old house after over a year on the market. This was in the Lakewood area in Dallas. Here is my assessment of pricing just from what I have seen.
    1) Our first realtor did not help us set a realistic first price and never got us 'out in front' of the market. Granted we picked probably the worst time evar to start selling, but it's the realtor's job to actually do analysis rather than rely on gut feel for this market.
    2) We found that it was no problem getting people in to look at the house, but getting offers was very few and far between. Buyers were looking for updated everything vs sq footage. It was like the sq footage (which we bigger than most of the other houses around us) did not matter at all. Buyers just wanted to move in to something updated and not really worry about updating anything themselves. Not saying to out and spend money to update anything, but from what I saw, it made a big difference. Houses that were smaller, not in as good a location sold for closer to the asking price and much more quickly when they were recently updated. Our house was built in the 50's and was updated probably in the late 80's early 90's (nothing really done in the bathrooms). We did not update much at all living there for 8 years because we knew it was a 'starter' house. Looking back, we should have updated and then enjoyed living in the updates as it would make it much easier to sell.
    3) In hindsight, we should have taken the first offer we got. We were not desperate to sell and had a plan not to take a 'lowball' offer but try to get as much value from the sale as possible. Not working with that first offer cost us a lot of money. I still think prices are going down in general. In Lakewood, especially in the part where the old house was, there are a lot of flippers coming in and turning $300Kish houses into $850K+ houses. So i think the home sale price on paper might look to be going up (assuming they can sell those high dollar homes after the remodel) but for non remodel homes, the price is probably holding flat at best. again, it all depends on where you are at and what's going on in your hood.

    so tldr version. See what other homes have sold for. Note if they are updated or not; buyers seem to be craving homes that are move in ready and already updated and not care that much about sq footage (at least in my hood in Dallas). Also, don't waste your money on an appraisal.

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    I would get a good realtor to come up with a market value for your home. They can base it off comps for your style of home and the area you live in. It should not cost you any money.

    An appraisal is only required by the lending bank. Most of the time, the appraiser simply values the home at or near the negotiated selling price just so it will be approved by the lender. From my experience, appraisals do stick to the property for a while. I purchased a home in 11-09. When my lender requested an appraisal, they found one that had been done two months prior. It turns out, the seller had entered a contract with another buyer that ultimately fell through. That previous contract turned out to be for about 5k less than what I was willing to pay. My lender said that since the appraisal was for that lesser amount, that amount would be the most they would fund. So it worked in my favor because the seller had to lower the price to match that appraisal.

  7. #7
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    Quote Originally Posted by UTinBigD View Post
    not sure where you (or the house in question is located) but the easiest way to approach a selling point is to get comps for your area. That can mean hiring a realtor or finding another method/person to pull the comps for you. Even then your house is worth what someone will pay for it, not what your neighbor got 2 months ago.

    I am far far far from an expert but we FINALLY sold our old house after over a year on the market. This was in the Lakewood area in Dallas. Here is my assessment of pricing just from what I have seen.
    1) Our first realtor did not help us set a realistic first price and never got us 'out in front' of the market. Granted we picked probably the worst time evar to start selling, but it's the realtor's job to actually do analysis rather than rely on gut feel for this market.
    2) We found that it was no problem getting people in to look at the house, but getting offers was very few and far between. Buyers were looking for updated everything vs sq footage. It was like the sq footage (which we bigger than most of the other houses around us) did not matter at all. Buyers just wanted to move in to something updated and not really worry about updating anything themselves. Not saying to out and spend money to update anything, but from what I saw, it made a big difference. Houses that were smaller, not in as good a location sold for closer to the asking price and much more quickly when they were recently updated. Our house was built in the 50's and was updated probably in the late 80's early 90's (nothing really done in the bathrooms). We did not update much at all living there for 8 years because we knew it was a 'starter' house. Looking back, we should have updated and then enjoyed living in the updates as it would make it much easier to sell.
    3) In hindsight, we should have taken the first offer we got. We were not desperate to sell and had a plan not to take a 'lowball' offer but try to get as much value from the sale as possible. Not working with that first offer cost us a lot of money. I still think prices are going down in general. In Lakewood, especially in the part where the old house was, there are a lot of flippers coming in and turning $300Kish houses into $850K+ houses. So i think the home sale price on paper might look to be going up (assuming they can sell those high dollar homes after the remodel) but for non remodel homes, the price is probably holding flat at best. again, it all depends on where you are at and what's going on in your hood.

    so tldr version. See what other homes have sold for. Note if they are updated or not; buyers seem to be craving homes that are move in ready and already updated and not care that much about sq footage (at least in my hood in Dallas). Also, don't waste your money on an appraisal.
    this post speaks to exactly what I was mentioning...

    1. price it right and it will sell... you need to be honest about what you need to get out of the house and how quickly you can move and you need to have a realistic view of what your house is worth... a house that sits on the market is not good no matter how you look at it.. after 60 days people start to think "WTF is wrong with this one?"....
    2. rule of thumb... if you go 3 weeks or 12 showings and have no offers you are priced too high... period... if a lot of people are coming through your house and no one offers it is because you are too high... if no one comes through then they're not interested to even bother looking at your price.. you are too high..
    3. this one here is super important to take note of... usually the first offer you get is the best... there are stats that realtors have to support that... holding out for another $2-5k or some $#@! might wind up costing you a lot more down the road... get your $$ and go...

    the key is having a realistic view of your property value... take your emotions out of it and have professionals come give you a sales pitch and their thoughts for listing it..

    for example, I knew that comps supported my house selling at $205/sqft... we listed at $210/sqft... first offer was at $196/sqft and we told them to $#@! themselves and that the comps show $205 and to let us know if they're interested... we had a contract signed and agreed the next day at $204.75. If the price is fair and supportable they'll pay it. That way everyone leaves the closing table happy.

  8. #8
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    Don't do it. Get a good realtor that knows the comps. They buyer will get an appraisal after you get a contract.

  9. #9
    asshat TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd might be a clever chap. or know the right people. know what i mean, nudge nudge? TexasEd's Avatar
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    A realtor is looking for the commission, they get paid when they close.

    Coffee is for closers.

    Since they are getting a percentage of the sale their incentive is not necessarily going to be maximizing the sale because they could blow the sale and then no coffee.
    They will be motivated to close even at a lower price than you could get a few weeks/month later because the difference in their commission is not worth the wait.

    Just go into this process with your eyes open to everyone trying to $#@! you.

  10. #10
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    Damn, thanks y'all. I bow to the collective Shaggy consciousness.

    I appreciate your insight TBNL, and hope I didn't offend with the ass-pulling-out-of comments. I guess I'm just wary of how I'd ever pick a 'good' appraiser -- we are actually in Belton, and the relationships between dominant real estate companies, lenders, title companies, and appraisers around here are as creepily incestuous as SINCE73's 8th birthday party.

    I am totally on board with this:
    Quote Originally Posted by TexasEd View Post
    Just go into this process with your eyes open to everyone trying to $#@! you.
    LHF68, any new stuff on y'all's website? We're going to be looking at architects before too long.

  11. #11
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    Quote Originally Posted by TexasEd View Post
    Just go into this process with your eyes open to everyone trying to $#@! you.
    bull$#@!... hire the right realtor and they'll be on your side to make it happen to make you happen... that is how referrals come about and how you develop a good name in the market..

    but YOU must be an integral part of the process... do your due diligence and know where the market is... a realtor can't force you to do $#@!... keep your emotions in check... you have to be open and honest about your situation with them and give them the proper guidance... no secrets and no alternate motives they aren't aware of..

  12. #12
    An appraisal is someone's opinion. That is all. Don't read any more into it. If you want to know what your house is worth, get a Realtor to supply you will a bunch of comps and do your own analysis. Look objectively at your house and how it compares to other houses that have actually sold. Find some that are clearly less desirable than yours. Find some that are clearly more desirable than your. Your value will be somewhere between the two. The more data your use for your analysis, the better.

    Bernard

  13. #13
    Another thing to consider is that back in '06 and '07 when the housing market washunky dory, homes were selling in 30-45 days with few foreclosures. Lots of turnover of inventory. A 2.5 month supply of homes, meaning that if no new listings came on the market, the supply of homes for sale would not be depleted for 2.5 months.

    Nowadays, with this $#@!ty market, it is typical that average days on market is 120-180 days. Mucho foreclosures. Lots of people trying to sell before they lose the house. Little turnover, and 8 month supply of homes.

    Thats pretty much what is happening here in Bexar county.

    So.....more for buyers to choose from. Buyers market. Maybe foreclosures aren't an issue in your specific neighborhood, but Joe Homebuyer may know he can go into those high foreclosure neighborhoods and buy 3-4 re-pos for what you are asking, and Joe HouseFlipper knows instead of renovating your house and making $100K profit, he too could go buy the same 3-4 houses that Joe Homebuyer looked at, renovate and flip them, and walk away with $150K profit.

    The point is, given the buyers marketthe asking price is even more crucial right now....again, I KNOW realtors can sometimes be totally clueless as to value. From experience. But get a realtor to give you a RANGE of values, which would be the price that gets the house sold within in 30-45 days, a price that sells within 3 months, and a value that sells within 6 months. That should be your low to highs. Then have them explain how they got to those 3 values and what compas they used. If each scenario makes sense and seems supported, then maybe they have their **** together and their values are good.

  14. #14
    No need for an appraiser. Set the price by what comps have sold for in the last 6 months not what the present comps are listed for. Don't waste your time chasing the market down. Leave the price dreams to the others that are making your price attractive.
    Last edited by Rippin' lips; 05-04-2011 at 10:30 PM.

  15. #15
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    even the best realtor has not had the training and CE required of a licensed appraiser. they probably don't know the laws about how much to add or deduct for things like granite countertops, or wood flooring, or sprinkler system, or not having those things in communities where things like that are common or standard. they may not know how to adjust for sq footage differences, or that the largest home in a neighborhood is worth less per sq ft than others. they may not know that a comp that is only a mile away but is across a major road is considered a different neighborhood and the property is not a desireable comparable at all when assigning value.

    in short, if you want the best estimate of the value of your home, get an appraisal from a licensed appraisal that is intimately familiar with your neighborhood and surrounding neighborhoods. of course that doesn't mean that anyone wants to buy your house for full market value.

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    Quote Originally Posted by Damor View Post
    3) If I get an appraisal done, does it "stick" for a certain period of time? My concern would be that, if say we were to be able to sell for higher than our appraisal (in my fantasy world of unicorns and gumdrops), could that lower appraisal cause a problem at closing?
    If the person buying the home is going to mortgage the home, an appraisal will be done at the buyer's cost. The underwriters won't agree to lend the money if the appraisal doesn't support the purchase price.

    There isn't a reason for you to appraise it, but it will be appraised eventually by the buyer, and if your price is too high, it could keep their loan from closing (usually doesn't - they just re-appraise it and make some adjustments.)

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    Quote Originally Posted by Duck of Death View Post
    even the best realtor has not had the training and CE required of a licensed appraiser. they probably don't know the laws about how much to add or deduct for things like granite countertops, or wood flooring, or sprinkler system, or not having those things in communities where things like that are common or standard. they may not know how to adjust for sq footage differences, or that the largest home in a neighborhood is worth less per sq ft than others. they may not know that a comp that is only a mile away but is across a major road is considered a different neighborhood and the property is not a desireable comparable at all when assigning value.

    in short, if you want the best estimate of the value of your home, get an appraisal from a licensed appraisal that is intimately familiar with your neighborhood and surrounding neighborhoods. of course that doesn't mean that anyone wants to buy your house for full market value.
    technically, this is correct.

    however, houses sell based on what other houses sell for. upgrades will get you something in some areas (ldogg's house is quite upgraded and he got paid for it) while other neighborhoods tend to stay within the range of the neighborhood, regardless of the upgrades. In such cases, the upgrades may make the house sell faster than others, but not for more.

    What I would do is drive/ask around your area for which real estate agent(s) sell(s) a lot of homes in your area (ie, is likely to be more educated on comps) and get them to do a market comp for you.

    Hell, if you're in Houston. I'll give you some basic comps.

  18. #18
    Quote Originally Posted by HoosierHorn View Post
    however, houses sell based on what other houses sell for. upgrades will get you something in some areas (ldogg's house is quite upgraded and he got paid for it) while other neighborhoods tend to stay within the range of the neighborhood, regardless of the upgrades. In such cases, the upgrades may make the house sell faster than others, but not for more.
    Not saying any of this is inaccurate or bad advice....just needs a little clarification.

    Yes, in such a case, selling prices of upgraded homes may tend to stay within the range of the neighborhood.....but it may be that the upgraded homes are setting the upper range.
    The upgrades may make the house sell faster, AND sell for more. More than the non-upgraded homes, in the upper range, but not necessarily more than the other upgraded homes.

    Upgrades can help....they can also hurt. If the contributory value of the upgrades pushes the value up, even by just a small %, buyers may reason that while the upgrades are nice they don't want to pay extra for them when there are equally livable not necessarily updated homes, same utility and comfort, that can be bought for less. Thus, they may not sell faster.

    And while you and your spouse may love the wooden flooring you spent $8 grand installing, that doesn't mean they will be willing to pay $8 grand more. On one hand they may be willing to pay, say, $1 grand extra to have nice clean new wood floors. On the other hand, it may be potential buyers DON'T like them (prefer tile, don't like the stain color, the dogs will scratch them, other reasons) or, they just plain simply would rather have non-updated floors so they can pick the exact flooring they like, a clean pallette. And in that example, an upgrade can cause a house to sell slower, even with upgrades.

    But this is sort of a tangent.....like I said, what you posted isn't wrong, just needed a little clarification.

  19. #19
    Realtor did all the comp research for us before we put ours on the market. We're scheduled to close this Monday, put it on the market 1st week of January. We ended up selling it about 10k less than the original listing price. The Buyers Lender had the house appraised, but I have no idea what they came up with. I'm assuming close to what we're selling it for, since nothing has been changed with the contract.

  20. #20
    asshat William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon slams and goes hard. William Cannon's Avatar
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    Quote Originally Posted by UTinBigD View Post
    Buyers were looking for updated everything vs sq footage.
    that's Dallas for you...

  21. #21
    Banned Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen
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    18 year certified appraiser here. Just a couple of thoughts

    Wouldn't pay for an appraisal unless you & the realtors aren't see eye to eye on value. Most experienced realtors can do that as long at they have accurate information on square footage (or GLA - gross living area). If there is any major discrepency (probably over 50+ sq ft) it would pay to have an appraisal or have some one at least measure it and provide you with a sketch of the proeprty. Most value problems are caused by inaccurate sq footage

    Any apprasial that YOU have done is completely private. You are identified as the client and you have sole discretion on how that information is used. It is between you & the apprasier. You can use it however you see fit or not at all. It's just an opinion of value (hopefully an educated & well thought out one).

    Like others have said, the eventual buyer will have to get one (assuming its not a cash buyer), but you will never see that one. It is between the lender & the buyer. You will only hear about it if comes in below the sales contract price.

    Good luck

  22. #22
    asshat Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang Shaggy Gold Club Gil Bang's Avatar
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    Quote Originally Posted by Duck of Death View Post
    even the best realtor has not had the training and CE required of a licensed appraiser. they probably don't know the laws about how much to add or deduct for things like granite countertops, or wood flooring, or sprinkler system, or not having those things in communities where things like that are common or standard. they may not know how to adjust for sq footage differences, or that the largest home in a neighborhood is worth less per sq ft than others. they may not know that a comp that is only a mile away but is across a major road is considered a different neighborhood and the property is not a desireable comparable at all when assigning value.

    in short, if you want the best estimate of the value of your home, get an appraisal from a licensed appraisal that is intimately familiar with your neighborhood and surrounding neighborhoods. of course that doesn't mean that anyone wants to buy your house for full market value.
    The goal of the appraisal is to determine "most probable sales price".

  23. #23
    Quote Originally Posted by Just the Tip View Post
    If there is any major discrepency (probably over 50+ sq ft) it would pay to have an appraisal or have some one at least measure it and provide you with a sketch of the proeprty. Most value problems are caused by inaccurate sq footage

    Good luck
    Another reason why I have little confidence in realtor estimates of value.

    Good example is an appraisal I did years ago.
    After confirming I had the assignment, knowing nothing about the property, I went to the appraisal district website to see what their records showed, and MLS to look for current listing, prior sales.

    Okay, both the MLS and appraisal district say it was a 3 bedroom, two bath, 2500/sf. home, sold ten years prior. Current list price was $250,000.

    Get out there, nope, it is 3200 sf.

    Most MLS/realtors just pull the square footage off the appraisal district records. If the district records are wrong.......then the MLS listing will be wrong as well. In this case, sometime in the 10 years since the prior sale, the owners added a 700/sf addition.....district was never aware...thus the listing only reflected 2500/sf.

    How the $#@! a realtor can walk a house and feel that it is 700/sf larger is beyond me.

    But anyway, the buyer was getting the deal of the century. 2500/sf homes were selling for $250K, while 3200/sf homes were selling for around $300K.

    So, long story short, I've seen that time and again so I have little confidence in realtors.

  24. #24
    I put my house on the market when I decided to get the $#@! out of Bell County 1.5 years ago (which is where I think you are, Damor).

    Anyway, everyone loved our house, and we got a buyer. Negotiated and got a great price for our home. Appraisal came in significantly under, due to it being a small subdivision with little comp. sale history. Another factor was that one of the houses was foreclosed on against the builder by a contractor for a VERY low price, but that sale counted in the appraisal, which is common and allowable. Additionally, the cool upgrades to your home, for the most part, mean $#@!.

    It's not just a matter of the buyer reconsidering their decision. in our case, the buyer's lender would not loan the $ for a sale at the price agreed upon. We ended up having to sell it to him for a lower price to make the #'s work. Believe it or not, the market value of a good/asset is actually NOT what a willing buyer and seller will exhange it for. You may have heard that principle discussed in every single economics class you ever heard, but in reality, it doesn't work that way.

    Also, if you have a local appraisal done, know that the new regs basically have appraisers come from out of the area to avoid collusion with realtors, etc.
    Last edited by scottsins; 05-08-2011 at 09:23 AM.

  25. #25
    asshat beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer Shaggy Gold Club beer's Avatar
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    Quote Originally Posted by TexasEd View Post
    Coffee is for closers.
    this is not getting enough love

  26. #26
    Banned Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen Just the Tip is a Model Citizen
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    Quote Originally Posted by scottsins View Post
    I put my house on the market when I decided to get the $#@! out of Bell County 1.5 years ago (which is where I think you are, Damor).

    Anyway, everyone loved our house, and we got a buyer. Negotiated and got a great price for our home. Appraisal came in significantly under, due to it being a small subdivision with little comp. sale history. Another factor was that one of the houses was foreclosed on against the builder by a contractor for a VERY low price, but that sale counted in the appraisal, which is common and allowable. Additionally, the cool upgrades to your home, for the most part, mean $#@!.

    It's not just a matter of the buyer reconsidering their decision. in our case, the buyer's lender would not loan the $ for a sale at the price agreed upon. We ended up having to sell it to him for a lower price to make the #'s work. Believe it or not, the market value of a good/asset is actually NOT what a willing buyer and seller will exhange it for. You may have heard that principle discussed in every single economics class you ever heard, but in reality, it doesn't work that way.

    Also, if you have a local appraisal done, know that the new regs basically have appraisers come from out of the area to avoid collusion with realtors, etc.
    In my side of business, we hear the part about having "a willing buyer and that should constitute market value" argument a lot. The part people leave out is a "well informed buyer". If its a cash transaction, then people can do whatever they want. Just because somebody agrees to pay $10K for a car that's worth $2K doesn't mean the bank is going automatically give you the money because you have a willing buyer & seller.

    This is not to say you didn't get screwed over on your appraisal. There a lot of dumb $#@! appraisers out there unfortunately. But you have to remember that not only do we have guidelines from Fannie & Freddie, but also from the lender involved. Their rules are usually much tighter than the secondary market guidelines. Especially now. There are times where appraisers are restricted on what they can & can't do by the lender. There are many dumb $#@! underwriters/lenders out there that don't let the appraiser do their job.

    Appraisers should not come from out the area. If they are not familiar with the market they are appraising in, they are in violation of the rules. The problem is your mortgage giants (Wells, Bank of America, Chase etc.,) are $#@!ty to work for & keep a huge portion of the appraisal fee (collect $450 from the borrower, pay some appraiser $200 to do it). Well, the good appraisers have said F you and won't work for them. So you get the bottom rung of guys that are starving and need work because the good lenders won't hire them. Sometimes they have to pull them in from other areas because the local appraisers won't work for them. Plus you get an underwriter in Indiana underwriting an appraisal in Dallas, who knows nothing about the local market.

  27. #27
    Quote Originally Posted by Just the Tip View Post
    In my side of business, we hear the part about having "a willing buyer and that should constitute market value" argument a lot. The part people leave out is a "well informed buyer". If its a cash transaction, then people can do whatever they want. Just because somebody agrees to pay $10K for a car that's worth $2K doesn't mean the bank is going automatically give you the money because you have a willing buyer & seller.

    This is not to say you didn't get screwed over on your appraisal. There a lot of dumb $#@! appraisers out there unfortunately. But you have to remember that not only do we have guidelines from Fannie & Freddie, but also from the lender involved. Their rules are usually much tighter than the secondary market guidelines. Especially now. There are times where appraisers are restricted on what they can & can't do by the lender. There are many dumb $#@! underwriters/lenders out there that don't let the appraiser do their job.

    Appraisers should not come from out the area. If they are not familiar with the market they are appraising in, they are in violation of the rules. The problem is your mortgage giants (Wells, Bank of America, Chase etc.,) are $#@!ty to work for & keep a huge portion of the appraisal fee (collect $450 from the borrower, pay some appraiser $200 to do it). Well, the good appraisers have said F you and won't work for them. So you get the bottom rung of guys that are starving and need work because the good lenders won't hire them. Sometimes they have to pull them in from other areas because the local appraisers won't work for them. Plus you get an underwriter in Indiana underwriting an appraisal in Dallas, who knows nothing about the local market.
    Well said.

  28. #28
    asshat BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn can play the whole course with a 4 iron. At night. BearLakeHorn's Avatar
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    Quote Originally Posted by To be named later View Post
    Good example is an appraisal I did years ago.
    After confirming I had the assignment, knowing nothing about the property, I went to the appraisal district website to see what their records showed, and MLS to look for current listing, prior sales.

    Okay, both the MLS and appraisal district say it was a 3 bedroom, two bath, 2500/sf. home, sold ten years prior. Current list price was $250,000.

    Get out there, nope, it is 3200 sf.
    This is the exact reason that I would recommend an appraisal -> to get an updated and accurate # for the sqft.

    We built our house almost 5 years ago. Builder listed it at 2500sqft and that is what the tax records per Travis County show. But we had a private appraisal as part of our closing and the guy walked it and the private appraisal came in at 2650sqft.

    We have not told this to Travis County. My goal is to inform Travis County maybe 6 months before we plan on selling, not sure how to do that (tips? otherwise I'll cross that bridge then). But I would like to have the county update their #s right before selling such that anyone who looks on TCAD will see 2650sqft as well

    But say 150sqft @ $110 per sqft in my neighborhood, that's $16,500 difference.

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