Contract Prices

[factsandtruth]

I've had several fall short of the contract prices over the past month. I give each realtor a chance to provide comparables for my consideration, and several of them tell me that they cant find closed sales at that price, but have pending sales that do. If an overly optimistic agent with a commission on the line can't support the contract price, how can they expect an appraiser to do it.

I agree with you totally. I have had a couple of agents not respond when asked to provide comps you want me to consider. I guess they want me to take on the liability and save the over priced deal...appraisers will learn when it's time to refinance and the homeowner cant refinance and complains to the "board" with proof from a over valued previous appraisal. "The previous appraiser said my home was worth this amount" homeowner....

 

[AppraizinAZ]

I'm glad to hear this, I am finding it a rarity in the past few weeks to make it even close on some to the contracted price!

 

[Deleted member 80407]

Contract price does not always agree with market value. Market value could be more than or less than contract price. The appraiser's job is to supply a supportable opinion of value whether it is less than, equals to or more than contract price. It is up to the lender as well as the buyer what to do with the appraiser's supportable opinion of value in regards to the transaction.

 

[Terrel L. Shields]

When you push something hard enough, it will fall over - Fud's First Law of Opposition.

You can resist these prices for about so long and then they are going to rise anyway. You can't hold that line...and probably it will create some sort of bubble. Only higher interest rates or the banks themselves can stop it. And the banks can't make money unless they lend, so lend they will regardless they know it will "blow up"..

 

[jtinmichigan]

Glad its not just me. After a spring season where most of the contract prices were reasonable and could be supported, I have just killed 3 in a row. Back to back for one lender last week. Next one up for another and killed that too.

Maybe killed is the wrong word. I reported that the contract price was not supported by the available comps.

Hopefully I saved the buyers from paying too much, or the lender getting stuck with something they couldn't get out of. Nah, I'll probably just get blackballed.........

 

[erockinaz]

Hopefully I saved the buyers from paying too much, or the lender getting stuck with something they couldn't get out of. Nah, I'll probably just get blackballed.........

That's the hope. I checked on one that I appraised $20k under contract price about three weeks ago and saw that it just closed for $10k less than the contract. They obviously renegotiated and split the difference.

 

[glenn walker]

San Francisco , the Bay area and parts of Los Angeles are seeing many closed sales $100,000 to $150,000 over list price. Luckily many are cash purchases or mostly cash so even if they don't appraise for contract nobody cares. It's a little scary I feel like were back in 2005-2006. Many of these homes are real old and not in great physical condition , typical paint on a pig , a granite counter top , laminated wood flooring and a lot of paint.