Reply to Anybody bought at house without an appraisal contingency?

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[quote=Anonymous]"10:57 - I would be HORRIFIED if we paid 762K and the appraisal came in at 700K, even though we would have the cash to make up the difference. I don't think that it would end up this extreme, but I could imagine the appraisal coming in below $740K, which would still be a big hit. How did things work out for you with overpaying initially? Have you regained the value? Like you, it is important to us to get this house. "

We bought in 2004 so we did get the 30K back but only because 2005/6 went up enough to counter the big bust a few years later. We just refinanced and the appraisal came in at 3K more than we purchased in 2004. We are OK with this for reasons that are specific to our situation.

*I made much more than I expected on the sale of my condo in 2004 and we paid down a significant portion of the house to get a low interest rate and lower monthly payment. If we had to sell tomorrow while I would technically take a small oss if we sold at the exact appraisal value and factored in the realtor commission, we would still walk away with most of what we put into the house pluse the 6 years living there and the tax benefit.

*We expect to be here for at least another 5-10 years and the market will probably go up but not to the extreme levels we saw in the boom.

*The "what if" is not exactly relevant as so many other things would have changed. The best "what" if for us would have been selling the condo in 2005, renting until the bust, and buying now. I'm not a psychic so we could have ended up stuck in our condo with two kids if we waited too long until after the market burst. We also probably would not have rented in the area we are live in now and so many things would have been different..different nanny, different preschools you name it. DH left a job he was lukewarm about because the commute to our new house was so bad. If we had rented we would have rented closer to work. He probably would not have left if the commute had not been so bad. He loves the job he has now.

While I don't agree with the statement you should not buy a house unless you love it so much you would be fine paying way, way overmarket, I do think you need to weigh what 20K means to you overtime. People became used to the idea that when you buy a house you start racking up 10-20% in equity every year and its a money maker for you. This was not always the case. It used to be that people hoped for their house to appreciate enough to cover the real estate commission and maybe have a little left over toward the next downpayment. People factored into the amount they would pay in rent against the mortgage and tax benefit rather than the windfall they would make selling in a few years.
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