Sandra Koutsopoulos
Senior Member
- Joined
- Jul 13, 2005
- Professional Status
- Certified Residential Appraiser
- State
- California
Looks like pricing strategies vary from region to region.
Typically for REOs, we're asked to bring it in at current fair market price within 60-90 days, and a 2nd value of property could be held til H**L freezes over.
But there is the factor of a property becoming stale on the market if overpriced to begin with, which often results in properties selling UNDER market eventually, so lenders are typically looking to us to tell them what the property in its current condition is worth RIGHT NOW! With that in mind current sales and current listings lay out the best market info.
MOTIVATION:
1) Buyers typically assume that if the prev owner couldn't pay the mortgage, it's likely he didn't fix things in a timely manner either, so it's definitely a Buyer Beware price, which likely is not top dollar. That may very well be an issue calling for appraiser's judgment.
2) Agents get paid when the sale closes. They typically close faster with a lower-than-retail price (which means agent is more likely to be paid, & quicker)
3) If agents are motivated to list it low for their own best benefit, lenders are looking to appraisers to discover the most probable current market value; they can choose to list it lower then FMV to expedite a sale, but I think it is our job to not be biased towards any other party's motivation. Just tell it like it is, all things considered.
4) We are appraisers. It is our expertise in determining value that lenders are paying for. Salespeople have expertise in salesmanship. Those are 2 different motivations.
Typically for REOs, we're asked to bring it in at current fair market price within 60-90 days, and a 2nd value of property could be held til H**L freezes over.
But there is the factor of a property becoming stale on the market if overpriced to begin with, which often results in properties selling UNDER market eventually, so lenders are typically looking to us to tell them what the property in its current condition is worth RIGHT NOW! With that in mind current sales and current listings lay out the best market info.
MOTIVATION:
1) Buyers typically assume that if the prev owner couldn't pay the mortgage, it's likely he didn't fix things in a timely manner either, so it's definitely a Buyer Beware price, which likely is not top dollar. That may very well be an issue calling for appraiser's judgment.
2) Agents get paid when the sale closes. They typically close faster with a lower-than-retail price (which means agent is more likely to be paid, & quicker)
3) If agents are motivated to list it low for their own best benefit, lenders are looking to appraisers to discover the most probable current market value; they can choose to list it lower then FMV to expedite a sale, but I think it is our job to not be biased towards any other party's motivation. Just tell it like it is, all things considered.
4) We are appraisers. It is our expertise in determining value that lenders are paying for. Salespeople have expertise in salesmanship. Those are 2 different motivations.
