Preparing for an appraisal

[Anonymous]

Our appraisal - at the $1.0-1.5m property value - was awful.
There were "not enough data points the last six months in our neighborhood" so the guy went out 12 months and a few miles this way and that (i.e. across 4 lane highways and to other school districts).

We could refi (which was 60% LTV anyhow), but I don't know how anyone would successfully sell a property with that extremely low appraisal. Something was definitely wrong, the comps made no sense (were 10-30 years older homes, no remodeled kitchens, fire sales, no homes newer than ours for some reason, implied values lower versus homes that are routinely assessed LOWER than ours, etc.).

The government and regulations really have the banks in a corner.

[Anonymous]

Anonymous wrote:Zillow, Redfin, & others are based on tax assessments as a formula for prediction of an estimate. Redfin gives a low, mid, and high... but all three are wrong in my neighborhood in MD. You will know this if you life in a rowhouse or townhouse neighborhood and your neighbor's house is the same model, same features as yours and it's "estimates" are less than yours.

Don't forget, tax assessments can be inaccurate... it's moronic to think the assessors have that all right. OP, it *could* benefit you to protest the assessment and have it raised.

Recent SALES, updates and/or renovations, location, and tax assessments should all be taken into account. In an urban location, especially a changing one, new restaurants & goods/services can also raise an assessment. OP if there are new retail/restaurants opening in your neighborhood point this out to the assessor... let them know the location is important & why.

NO NO NO, zillow does NOT SOLE:Y use tax assessments it uses comps. This is incorrect, they USED to use assesments when they did not have enough data about DC but now they DO NOT use tax assessments.

http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm

[Anonymous]

Anonymous wrote:

Anonymous wrote:Zillow, Redfin, & others are based on tax assessments as a formula for prediction of an estimate. Redfin gives a low, mid, and high... but all three are wrong in my neighborhood in MD. You will know this if you life in a rowhouse or townhouse neighborhood and your neighbor's house is the same model, same features as yours and it's "estimates" are less than yours.

Don't forget, tax assessments can be inaccurate... it's moronic to think the assessors have that all right. OP, it *could* benefit you to protest the assessment and have it raised.

Recent SALES, updates and/or renovations, location, and tax assessments should all be taken into account. In an urban location, especially a changing one, new restaurants & goods/services can also raise an assessment. OP if there are new retail/restaurants opening in your neighborhood point this out to the assessor... let them know the location is important & why.

NO NO NO, zillow does NOT SOLE:Y use tax assessments it uses comps. This is incorrect, they USED to use assesments when they did not have enough data about DC but now they DO NOT use tax assessments.

http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm

Then please explain the new neighborhoods with the exact same model house but listed as different estimates?

[Anonymous]

OP here, in my neighborhood the homes were built in the late 1800s. My house is identical to five houses on either side. The house next door is in terrible shape yet Zillow says $50k more than ours, the house to the other side is in excellent condition (I'd say ours is good), recently renovated and yet Zillow says only $20k more than the house that's almost falling down. The prices are directly in relation to the taxable assessment. I successfully appealed my assessment back in 2004 (at that point my house was assessed much higher than all the comparable properties) and because of that they seem to have kept my increases lower than neighboring homes (actually in the last couple of years have had decreases like much of our zip code, despite healthy and increasing sales). The poor condition house next door has changed hands a couple of times triggering a re-assessment so is listed relatively much higher than mine. So while comps may be what Zillow says they use, it's pretty clear that the tax assessments are a huge factor on my block at least.

[Anonymous]

What do you actually print on comps to give to the appraiser? Listing on redfin or zillow?

[Anonymous]

Anonymous wrote:OP here, in my neighborhood the homes were built in the late 1800s. My house is identical to five houses on either side. The house next door is in terrible shape yet Zillow says $50k more than ours, the house to the other side is in excellent condition (I'd say ours is good), recently renovated and yet Zillow says only $20k more than the house that's almost falling down. The prices are directly in relation to the taxable assessment. I successfully appealed my assessment back in 2004 (at that point my house was assessed much higher than all the comparable properties) and because of that they seem to have kept my increases lower than neighboring homes (actually in the last couple of years have had decreases like much of our zip code, despite healthy and increasing sales). The poor condition house next door has changed hands a couple of times triggering a re-assessment so is listed relatively much higher than mine. So while comps may be what Zillow says they use, it's pretty clear that the tax assessments are a huge factor on my block at least.

+1 thank you

[Anonymous]

Zillow is a piece of crap, as are other software programs....I have had more than my share of RE agents tell me the same....I too was looking at a refi and in shopping around asked how a carrier used the comps they got from an appraiser. A few said they used zillow as a baseline. When I heard this I dropped them...why, well here it goes I had one carrier put in my address in zillow...and out popped a nice house, etc. the only problem is IT WASN'T MY HOUSE, same neighborhood, same street but just a block away or 14 houses from my house = how can the compare anything when even the baseline they're using is wrong...it's a bunch of junk....

stay away from any carrier that uses this or any other program.

[Anonymous]

Anonymous wrote:Zillow is a piece of crap, as are other software programs....I have had more than my share of RE agents tell me the same....I too was looking at a refi and in shopping around asked how a carrier used the comps they got from an appraiser. A few said they used zillow as a baseline. When I heard this I dropped them...why, well here it goes I had one carrier put in my address in zillow...and out popped a nice house, etc. the only problem is IT WASN'T MY HOUSE, same neighborhood, same street but just a block away or 14 houses from my house = how can the compare anything when even the baseline they're using is wrong...it's a bunch of junk....

stay away from any carrier that uses this or any other program.

Must say I agree. Zillow's worthless.

I bought my house for $950k in May 2011. Says today it's worth $1.08 million. Ain't no flipping way.

[Anonymous]

Anonymous wrote:Thanks everyone. The appraiser came by yesterday. I printed out a couple of comps to give him. they weren't as close by as I'd hoped, but within about 8 or so blocks, similar size home each with one more bathroom prices $550-600k. He seemed like he had a decent idea of the neighborhood. I also gave him a list of our improvements to the house, and a list of improvements to the neighborhood (huge change since I bought in 2003 including new coffee shops, bars, yoga studio, playgrounds etc) and to our block. We'll find out in a few days what he thought. I'm still crossing fingers that he doesn't use fixer uppers on busy main roads as comps, otherwise there shouldn't be an issue with getting beyond $400k as it's only the ones in really poor shape sold to investors and on busy undesirable sketchy roads that have sold for less than $400k in recent months.

OP here again. Just heard from the loan officer that the house appraised for over $560k. That's crazy! (But good). I really can't imagine that our house would sell for that much and am interested to see the report. I know inventory is low in our neighborhood so the market must be looking pretty good. We paid 220k for the house in 2004.

[Anonymous]

That's fantastic, which bank lead this?

[Anonymous]

Anonymous wrote:That's fantastic, which bank lead this?

Yes, do you mind telling us? We had an appraisal for a refi and the appraiser assumed all areas in the zip code were equally valuable, even though there are different school zones within the zip code, and people seem convinced that our schools are better than the other ones. We got as much money as we needed, but I was pretty surprised that the appraiser, who was supposedly an expert in the area, didn't account for the difference (which I suspect is probably only about 10%, but for a lot of people, that would matter).

[Anonymous]

It's from my credit union which I joined via my employer. Appraisal is high enough for cash out refinance at 4 percent for 30 year fixed with no points. If it had been significantly lower (nearer 400k as I was expecting) I may have had to pay a .5 point.