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Thread: Real Estate

  1. #1
    Join Date
    Feb 2018
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    N CA
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    Real Estate

    Given the market is tightening everywhere, we definitely timed our move at the wrong time so we are not coming out of the sale/buy on our new place. That is the market and that’s the way it is. I’ve not bought a lot of property in my time but the process kinda sets me off. My complaint is the process, specifically, the appraisal. The lender selected an appraiser known for his conservative views on valuations according to the realtor group we have. Now, our property is old by CA standards, showing on maps from the 1860’s. It is known locally as the “Cabin in the Sky” and has that on a sign hangin off the front of the house. A grandson of the 1920’s owner said the sign was there when his Grands bought it back then and the views are spectacular to the W. The appraiser, comes in and does his walk through and gave no value to the view as it was not visible from the living room, which faces the road. We completely re-built this place in 13/14 and actually talked about switching the lay-out, but the best parties are kitchen parties and on out to the yard so we have a fabulous view out the 8’window and the 6’ on the side. That valuation is according to the realtor worth about $40k of value. My bi*** is the complete arbitrariness of this opinion and as a result the places did not appraise at value that we had agreed with the buyer, and why would the bank want a higher value in this market with all that is going on, so there it sits. The lender ignores appeals and it is a one and done deal. I think the place has a view. What do you think? Oh, and that tire swing in the picture hangs 16’ off the 54” blk walnut beside the house. the grandkids have loved it but it scares the heck out of you when they are flying so high
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  2. #2
    Join Date
    Feb 2014
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    Lake Gaston, Henrico, NC
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    Is this Realtor working for the seller, or buyer? It doesn't sound right to me, but I've only sold houses sitting on real estate, and done some developing, for almost 50 years now.

  3. #3
    Funky stuff goes on in the appraisal business. That's been my personal opinion based on my limited experiences with it. Nuff said.

  4. #4
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    I haven't bought or sold much real estate but I'm confused by your post. I assume you are selling, so why are dealing with the buyer's lender? A property is worth whatever a buyer is willing to pay regardless of any appraised value. The appraised value comes into play when the buyer tries to get a mortgage so it is his problem. Shouldn't it be up to the buyer to find a lender that is willing to finance his purchase?

  5. #5
    Games are played in buying and selling property. A buyer may want a low appraisal because they go back to the seller and say, "Here's the appraisal and that's all my mortgage company will finance it for. You need to drop your price to the appraisal."

    Unless you're really pushed to sell, your response should be, "You'll have to put more up front to pay it down to the mortgage amount."

    Or offer the buyer a second mortgage for the difference between your price and the
    appraisal value. There's risk in that, of course.

    Or walk away.

    Mike
    Go into the world and do well. But more importantly, go into the world and do good.

  6. #6
    Quote Originally Posted by Doug Garson View Post
    I haven't bought or sold much real estate but I'm confused by your post. I assume you are selling, so why are dealing with the buyer's lender? A property is worth whatever a buyer is willing to pay regardless of any appraised value. The appraised value comes into play when the buyer tries to get a mortgage so it is his problem. Shouldn't it be up to the buyer to find a lender that is willing to finance his purchase?
    Doug I understand your point. The problem is if the buyer can't get the mortgage the deal falls through. Now it's a problem for both the buyer and seller.

  7. #7
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    When I was selling spec houses, I used one Savings and Loan company. They would come look at a house I had ready, and I would send them the buyer when one came along. I never used a Realtor, but had the financing lined up for anyone who needed it. As years went on, the Savings and Loan company never even came out to look at the houses. They were ready to go when a buyer came along. It never took over two weeks once I put a price on a house, and I didn't put a price on until I had finished it, had all my tools out, and was ready to let it go.

    I don't know if you can do that or not, but I'd look for another bank.

  8. #8
    Quote Originally Posted by Ron Citerone View Post
    Doug I understand your point. The problem is if the buyer can't get the mortgage the deal falls through. Now it's a problem for both the buyer and seller.
    In most cases the buyer can get a mortgage but it will be for 80% of the appraised value. That means the buyer has to put up the rest of the money, either in cash from their pocket or in some other second mortgage financing. A lot of buyers don't have that much money available.

    The 80% is for a conventional mortgage. It could be for a 90% mortgage or some other type of mortgage. In any case, the buyer has to make up the difference between the selling price and the appraised value.

    Mike
    Go into the world and do well. But more importantly, go into the world and do good.

  9. #9
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    Hire another Appraisal your own choice and see how it compares. It may cost you a couple thousand but then you have something to work from.
    Retired Guy- Central Iowa.HVAC/R , Cloudray Galvo Fiber , -Windows 10

  10. #10
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    I do not want to get too political but people hire one appraiser for taxes, one for buying and another for selling. The legality of this will soon be decided in courts.
    When my brother bought cars he always paid some in cash and some in check. He told the DMV the fees are based on the check price only, no cash was involved.
    Bill D

  11. #11
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    Quote Originally Posted by Bill George View Post
    Hire another Appraisal your own choice and see how it compares. It may cost you a couple thousand but then you have something to work from.
    Yes this. Or if you have a feel for what your property is worth and are not pressured to sell, tell your realtor your selling price. They can choose to represent you or not. They want to move it as fast as they can, because that's where the money is. Don't let the system push you around. It's your asset not theirs.

  12. #12
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    We bid high and got some of that back from the appraisal coming back lower as well as the inspection that allowed me to come up with a hefty list of stuff that needed remediated. Fortunately, our buyers didn't blink and said yes without hesitation. They still got a whole bunch more than the listing price, too.

    Our previous property sat for 9 months before we found the right buyer...and at substantially less than we originally listed it. Sometimes it's like that and paying two mortgages plus a bridge for nine months only to get a whole bunch less in the end was a little painful. At least financially. The buyers are great and just introduced their first son to the world.
    --

    The most expensive tool is the one you buy "cheaply" and often...

  13. #13
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    Quote Originally Posted by Ron Citerone View Post
    Doug I understand your point. The problem is if the buyer can't get the mortgage the deal falls through. Now it's a problem for both the buyer and seller.
    Agree, but how can you negotiate with the buyer's lender? You can't make any commitment on the buyer's behalf so why would the buyer's lender negotiate with you?

  14. #14
    When I had a Broker's Licensee, took an appraisal class. Instructor placed one value on a item in a property, but the whole class (some with more years of experience than instructor) placed a much greater value on same item. Just shows that "beauty is in the eye of the beholder." When we financed our house (1981) closest comp was over ten miles away, single story vs two story, in an abandoned cow pasture with NO TREES. Not exactually a comp! But it really didn't matter, as we had over 50% equity in house, plus we owned the lot between us and the road.
    Last edited by Bruce Wrenn; 03-21-2023 at 10:23 PM.

  15. #15
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    When we sold our century home back in Cambridge Ontario 25 years ago, our real estate agent had an agent's open house. All the agents agreed it was a great house but that she had overpriced it. It sold in less than a week for full asking price. So yes, not all experts agree and the value is whatever someone is willing to pay.

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