What did you do as a seller if appraisal came in low

[Anonymous]

We are worried about this since there is such low inventory and the comps are not even really comps in our opinion. Would hold out until spring (when there will presumably be more inventory) if we could but prefer to sell now.
Did you lower the price or stand firm? How receptive were the buyers? Did having a back up offer make a difference?

[Anonymous]

In what way are the comps available to you inadequate?

[Anonymous]

Anonymous wrote:We are worried about this since there is such low inventory and the comps are not even really comps in our opinion. Would hold out until spring (when there will presumably be more inventory) if we could but prefer to sell now.
Did you lower the price or stand firm? How receptive were the buyers? Did having a back up offer make a difference?

If the seller can pay the cash to make up the difference, that's one solution. The bank will only mortage 80% of the appraised value.

Otherwise you take the hit or cancel the sale and try again when prices come up.

[Anonymous]

It all depends on the buyer. If they are willing to pay cash to make up the difference, there is nothing to say that they can't over pay for your house. However, no sane buyer would do that in this market.

When we got our place 4 years ago, the seller wanted $314,000. The place only appraised for $298,000 and that's what we offered. They declined and said it was too low. Well a month later they came back and said they'd sell it to us for the appraised price. We still took a hit when the market crashed.

I think you are under an illusion that you'll get a better appraisal in the spring, IMO.

[Anonymous]

Anonymous wrote:It all depends on the buyer. If they are willing to pay cash to make up the difference, there is nothing to say that they can't over pay for your house. However, no sane buyer would do that in this market.

When we got our place 4 years ago, the seller wanted $314,000. The place only appraised for $298,000 and that's what we offered. They declined and said it was too low. Well a month later they came back and said they'd sell it to us for the appraised price. We still took a hit when the market crashed.

I think you are under an illusion that you'll get a better appraisal in the spring, IMO.

I think it depends on area and price point. I am seeing a lot of buyers now paying $$$$$ on homes (in the 800K-1M range) - multiple offers ten of thousands over asking price, muptiple people getting pre-offer inspection on the same house, buyers waiving contingencies all together. I am nto sure there are sane buyers left in this market

[Anonymous]

I'm confused. Judging by the way the OP wrote his comment, it sounds like the comps might not support a very optimistic price in favor of the seller.
On the other hand, there are bidding wars in many areas in the 800k to 1 mil range.

I can say this though - in 22301 (del ray), 22302 & 22305 (rosemont) and 22046 (downtown fc), I haven't seen any pattern of bidding wars in the price range. In fact, most, but not all, of the million dollar houses for these zip codes have sold for less than list price. Having said that, there has been a lot of competition in these zip codes for houses under 800k.

[Anonymous]

Anonymous wrote:

Anonymous wrote:It all depends on the buyer. If they are willing to pay cash to make up the difference, there is nothing to say that they can't over pay for your house. However, no sane buyer would do that in this market.

When we got our place 4 years ago, the seller wanted $314,000. The place only appraised for $298,000 and that's what we offered. They declined and said it was too low. Well a month later they came back and said they'd sell it to us for the appraised price. We still took a hit when the market crashed.

I think you are under an illusion that you'll get a better appraisal in the spring, IMO.

I think it depends on area and price point. I am seeing a lot of buyers now paying $$$$$ on homes (in the 800K-1M range) - multiple offers ten of thousands over asking price, muptiple people getting pre-offer inspection on the same house, buyers waiving contingencies all together. I am nto sure there are sane buyers left in this market

Oh sure. It all depends on what the buyer is willing to pay. It doesn't sound like there is any kind of a bidding war going on in this case.

[Anonymous]

I sold my place last September and the appraisal came in very low. However, in my area there was very little inventory and the buyer made an offer after our place had only been on the market for 24 hours. We didn't even have an open house. I walked away when they offered the lower appraised value (wanted to at least hold an open house) and the buyer came back a week later and made up the difference. I have to note that I thought our asking price was very fair. I think the appraiser was way off.

[Anonymous]

Anonymous wrote:I sold my place last September and the appraisal came in very low. However, in my area there was very little inventory and the buyer made an offer after our place had only been on the market for 24 hours. We didn't even have an open house. I walked away when they offered the lower appraised value (wanted to at least hold an open house) and the buyer came back a week later and made up the difference. I have to note that I thought our asking price was very fair. I think the appraiser was way off.

OP here, this is the kind of situation we have - had 3 really solid offers and we think (after a lot of considering and talking to several agents) that our price point is very fair. (We also listed it for what it appraised for last year when we refinanced)
The issue with the comps is that with very little inventory the appraiser said it could be "challenging". The other key issue for us is our great location and I've heard some appraisers don't take into consideration the proximity to metro, restaurants..etc. into their price. I would hope that these pros would make our house worth a little more than something several blocks away.

The buyer we selected is only putting 10% down and waived all other contingencies and was willing to go much higher with an escalation if that makes any difference.

[Anonymous]

Anonymous wrote:It all depends on the buyer. If they are willing to pay cash to make up the difference, there is nothing to say that they can't over pay for your house. However, no sane buyer would do that in this market.

When we got our place 4 years ago, the seller wanted $314,000. The place only appraised for $298,000 and that's what we offered. They declined and said it was too low. Well a month later they came back and said they'd sell it to us for the appraised price. We still took a hit when the market crashed.

I think you are under an illusion that you'll get a better appraisal in the spring, IMO.

the market was MUCH different 4 years ago than it is today.....

[Anonymous]

Does that buyer actually have the money to do that? As long as that buyer's financial situation is such that he could afford to waive the appraisal contingency, I would choose that buyer. Do you have financial information sheets on all the buyers?

[Anonymous]

Anonymous wrote:I'm confused. Judging by the way the OP wrote his comment, it sounds like the comps might not support a very optimistic price in favor of the seller.
On the other hand, there are bidding wars in many areas in the 800k to 1 mil range.

I can say this though - in 22301 (del ray), 22302 & 22305 (rosemont) and 22046 (downtown fc), I haven't seen any pattern of bidding wars in the price range. In fact, most, but not all, of the million dollar houses for these zip codes have sold for less than list price. Having said that, there has been a lot of competition in these zip codes for houses under 800k.

at 850k we had 4 bids on a 22043 place and lost out to someone offering asking price.

[Anonymous]

We were the buyers and just bought out home recently.

We came in lower than asking and lost it. But we were reapproached by the sellers a few months after because the first buyers "did not work out."

We come to find the home did not appraise. So they accepted our initial offer which was $15k lower. The during our appriasal the house did not appraise by $45k under and we could not pay the difference in cash.

So the sellers dropped the price by $45k and we got the house. Very thankful it all worked out!

[Anonymous]

Anonymous wrote:We are worried about this since there is such low inventory and the comps are not even really comps in our opinion. Would hold out until spring (when there will presumably be more inventory) if we could but prefer to sell now.
Did you lower the price or stand firm? How receptive were the buyers? Did having a back up offer make a difference?

I found out the the appraiser had two dogs. After a quick phone call explaining that I thought the house was worth 100K more than he did and telling him that I wasn't all that fond of dogs, he decided to re-run the comps on the property and viola, we were good.

Hakuna Matata

[Anonymous]

We had the same issue last Feb when we were buying. Awful data points that made little sense. We split the difference and put more money down.