5280
Freshman Member
- Joined
- Jan 9, 2021
- Professional Status
- Certified Residential Appraiser
- State
- Colorado
Hello. I am interested in getting the opinions of Colorado appraisers on how the appraisal process has been impacted by this crazy market so far in 2021. In February, our Denver market saw a huge decrease (over 50%) in the supply of homes for sale compared to last February, while demand remains really high. This has caused homes to close for significantly more than their list price, often times 50k, 100k, or even more. Now, escalation clauses are very common, allowing the buyer to bring the difference between the appraised value and the sale price in cash at closing.
I have been working mostly as a real estate agent this year, but the few purchase appraisals I have done have come in significantly lower than the purchase price. Sometimes there was an escalation clause, thereby saving the deal. But one did not, and the appraisal may have killed that deal. But I am interested to know what other appraisers are thinking about 2021 so far:
-As a Colorado appraiser, how has this 'new normal' of unprecedented sale prices impacted your appraisals, if at all?
-What experiences can you share regarding appraisal assignments where the comps clearly do not support the sale price?
-What long-term impact, if any, does this type of market have on appraisals this Summer and the rest of 2021?
-Has anyone heard of using other competing offers as comps, as a way to provide substantiation for a sudden increase in sale prices? This was suggested to me by an instructor who said they are doing this in other states, where an offer (or offers) on the same property can function as an additional comparable, similar to active or pending comps.
Any other thoughts you have regarding this subject would be appreciated. Thank you Colorado appraisers!
I have been working mostly as a real estate agent this year, but the few purchase appraisals I have done have come in significantly lower than the purchase price. Sometimes there was an escalation clause, thereby saving the deal. But one did not, and the appraisal may have killed that deal. But I am interested to know what other appraisers are thinking about 2021 so far:
-As a Colorado appraiser, how has this 'new normal' of unprecedented sale prices impacted your appraisals, if at all?
-What experiences can you share regarding appraisal assignments where the comps clearly do not support the sale price?
-What long-term impact, if any, does this type of market have on appraisals this Summer and the rest of 2021?
-Has anyone heard of using other competing offers as comps, as a way to provide substantiation for a sudden increase in sale prices? This was suggested to me by an instructor who said they are doing this in other states, where an offer (or offers) on the same property can function as an additional comparable, similar to active or pending comps.
Any other thoughts you have regarding this subject would be appreciated. Thank you Colorado appraisers!
