How appraisals are affecting the Phoenix real estate market:
In the last 10 years, Phoenix has seen some of the strangest trends as far as real estate. The crash in part was blamed on lenders as well as Appraisers and now we have found ourselves in a situation post-crash where we have a shortage of homes, multiple buyers interested and consequently multiple offers bidding up the price of the home. When it comes time for the Appraisal, the Appraiser is coming in with a value based on the previous sales and not taking into account current market trends thus creating an issue with the value on the home.
What all this means is that if you are accepting a financed offer, pay careful attention to the recent sales as well as the initial price of your house when you put it on the market because the appraiser may not see the added value based on the market trends. What then occurs is a re-negotiation of the deal either the buyer has to bring cash to bridge the gap between the contracted price and the appraised value or the seller accepts the new value as determined by the appraiser and reduces the price. If neither of those 2 options can happen, the contract can be canceled and the house would return to the market to solicit another offer.
How to protect yourself in today's market:
Price your home conservatively to attract as much buyer attention as possible and weigh the pros and cons of each offer with the help of your real estate agent. They will be able to advise you of potential pitfalls with each offer. You can also take the risk of the appraisal but know going in that you may have to renegotiate and know what your bottom number is.
If you need help with real estate or have some specific questions about the Phoenix Real Estate market, call me at (602) 748-6136.
Learn the value of your house and receive a free, no hassle consultation or seller's guide.
In the last 10 years, Phoenix has seen some of the strangest trends as far as real estate. The crash in part was blamed on lenders as well as Appraisers and now we have found ourselves in a situation post-crash where we have a shortage of homes, multiple buyers interested and consequently multiple offers bidding up the price of the home. When it comes time for the Appraisal, the Appraiser is coming in with a value based on the previous sales and not taking into account current market trends thus creating an issue with the value on the home.
What all this means is that if you are accepting a financed offer, pay careful attention to the recent sales as well as the initial price of your house when you put it on the market because the appraiser may not see the added value based on the market trends. What then occurs is a re-negotiation of the deal either the buyer has to bring cash to bridge the gap between the contracted price and the appraised value or the seller accepts the new value as determined by the appraiser and reduces the price. If neither of those 2 options can happen, the contract can be canceled and the house would return to the market to solicit another offer.
How to protect yourself in today's market:
Price your home conservatively to attract as much buyer attention as possible and weigh the pros and cons of each offer with the help of your real estate agent. They will be able to advise you of potential pitfalls with each offer. You can also take the risk of the appraisal but know going in that you may have to renegotiate and know what your bottom number is.
If you need help with real estate or have some specific questions about the Phoenix Real Estate market, call me at (602) 748-6136.
Learn the value of your house and receive a free, no hassle consultation or seller's guide.
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