Considering filing complaint for lack of market conditions adjustment on stale comps

[Fernando]

Look it this way and you will understand why people will submit Offers above List Price.

The Clues are Income levels of Buyers, Supply Shortage Mo'Buyers than Houses! Very Low Interest Rates. Intrest Rates Literally have no way to go but up.

Figure out how much more their Monthly House Payment will be at Sale Price at Listing Price. Then add a $1,000. How much did their 30 Year Mortgage Payment rise?
Add another $1,000. Keep Going!

Take into consideration they may have just migrated into the area, living in an apartment, already sold their home in New York/California. Income tax Time is coming soon. They have considerable discretionary income. Household Goods are in Storage. Their Living in an Apartment/Rental House and Lease renewal is coming Quickly.
Inflation is beginning to rear its ugly face.

That's interesting but I believe if people can't afford to put up the extra amount they're paying over "market value" then they shouldn't be stretching it.
These buyers are the ones who pulled the market down during the Great Recession.

 

[Carnivore]

That's interesting but I believe if people can't afford to put up the extra amount they're paying over "market value" then they shouldn't be stretching it.
These buyers are the ones who pulled the market down during the Great Recession.

The Original Poster of this Thread did just that. The Person did not walk, the person bit the bullet and put up substantial cash over and above the Appraised Value. What he is upset about is the fact he could not leverage the larger total mortgage. He took money from somewhere else JUST to Buy THAT Home.

 

[Mejappz]

f every data base, online sources, MLS, Fannie Mae, FRED are all screaming at the top of their lungs that the market is increasing, but the 1004MC is showing stable.....something is wrong. The appraiser either needs to find a different profession or get off their lazy you know what and analyze more data....

And as the article from the Appraisal Journal details, the 1004MC is a flawed model. So you will get poor results no matter how well you fill it out.

 

[Fernando]

The Original Poster of this Thread did just that. The Person did not walk, the person bit the bullet and put up substantial cash over and above the Appraised Value. What he is upset about is the fact he could not leverage the larger total mortgage. He took money from somewhere else JUST to Buy THAT Home.

So that's how these buyers think. I figured if they really want the house and they believe it's a good deal, they will find a way to get the money instead of putting the lender at risk.

 

[Carnivore]

So that's how these buyers think. I figured if they really want the house and they believe it's a good deal, they will find a way to get the money instead of putting the lender at risk.

Your forgetting about the Future Value of that Property.

 

[Fernando]

Your forgetting about the Future Value of that Property.

That's irrelevant. I know prices are going to go up in the future.
So that leaves me with present value.

 

[Carnivore]

That's irrelevant. I know prices are going to go up in the future.
So that leaves me with present value.

OK, it flew over your head. I was speaking to the motivations of a Buyer.

 

[Fernando]

OK, it flew over your head. I was speaking to the motivations of a Buyer.

Thanks, a lot things goes over my head.

 

[glenn walker]

Your forgetting about the Future Value of that Property.

We do not do prospective-Values on lender work -That's Consulting work which may be done for investors or developers but not an-appraisal.

 

[residentialguy]

I working on a purchase appraisal. The price is high compared to the sales over 6 months ago. Has prices gone up at least 10% especially on same block?
While driving taking comps, I was thinking the older comps are older and prices have increased because of the frenzy current market where buyers are buying over list price trying to be winning bidder.
Current market have many buyers willing to pay "above market" prices.
Appraisers are taught to use prior comps to justify current market values.
From our experience in area, we feel the prices are excessively high even though buyers think the high bid prices are market value.
We know that the market can turn when mortgage rates go up. Just as fast as it goes up, it can go down just as fast.

Today, I was thinking about this two different perspectives between buyers and appraisers.
We don't owe a duty to the buyers. Buyers think otherwise. Then Buyers should hire their own appraiser.
Our client is the lender which is why appraisers justify their appraised values based on past sales and not bidding prices.
We do consider the bidding prices but in the end, we give a point value we feel comfortable as demanded by client.

What? We feel comfortable? So these higher pending sales are not the market speaking?
Oooookaaayy...
Newsflash: Market Value is to the effective date... which is the day you do the appraisal for this kind of assignment. Your feelings that prices are going to high for your personal comfort level means diddly squat. Market facts are objective.