New home appraisal low during refinancing - please help me

[Jo Ann Meyer Stratton]

Is your property and the new home sales you discovered tract style homes where you go to an office and choose one of five or more plans to be constructed on the lot you select? In that situation the homes have been offered on the open market by the builder and are suitable for comparables. Although the county assessor might not have picked up and measured them for the next year's tax roll, the appraiser would be able to obtain the livable area, amenities, etc from the builder. Sale date would be available in recorded deeds. Sale price (depending on the laws of your state) may or not be available in public records. If not public information only the builder or the buyer would be able to disclose that information.

However==if you bought a lot some where then found a contractor to build you a home to your specifications, that is not an arm's length transaction. If the new homes you have researched were also the same situation they would not be appropriate sales to used as comparables as they were not exposed to the open market. They are considered created sales or land/home packages and are not indications of market value. In fact they are prohibited for almost all lenders. See #8 on the first page of the Appraiser's Certification where the appraiser certifies that they have not used that type of property as a comparable.

The above information regarding the properties you have suggested to the lender has to be verified as yes or no to the two above questions. If the answer to paragraph two is yes, they would not be appropriate properties to be used as comparables.

 

[RustyLingerfelt]

It is very important to know what did the 1004MC say are you in a declining market, are the comparable sales you offered in the same development, subdivision and or market area? Appraiser must follow the Georgia Classification and education law of 2004 and that requires us to use sales within the development, subdivision and or market area unless we have a credible reason to expand that search? If no information is available then no information may be available- appraisers are slaves to public records! Most new homes in my area are custom built, over priced and not arm length transactions. Most have no information and no real estate agent was involved so we can not ever get second hand knowledge. We are only human!

 

[Ken B]

If I the opportunity to buy a brand new home at the same price as a previously lived in home, all other things being the same, I would very likely buy the brand new home. Now then, if I could get the previously lived in home at a price somewhat lower than the brand new home, I might give the previously lived in home a second glance.

 

[expensiveduck]

What part of Georgia are you located in?

Did the original appraisal provide a deed book and page reference for the comparables included?

Forsyth county

 

[expensiveduck]

Is your property and the new home sales you discovered tract style homes where you go to an office and choose one of five or more plans to be constructed on the lot you select? In that situation the homes have been offered on the open market by the builder and are suitable for comparables. Although the county assessor might not have picked up and measured them for the next year's tax roll, the appraiser would be able to obtain the livable area, amenities, etc from the builder. Sale date would be available in recorded deeds. Sale price (depending on the laws of your state) may or not be available in public records. If not public information only the builder or the buyer would be able to disclose that information.

However==if you bought a lot some where then found a contractor to build you a home to your specifications, that is not an arm's length transaction. If the new homes you have researched were also the same situation they would not be appropriate sales to used as comparables as they were not exposed to the open market. They are considered created sales or land/home packages and are not indications of market value. In fact they are prohibited for almost all lenders. See #8 on the first page of the Appraiser's Certification where the appraiser certifies that they have not used that type of property as a comparable.

The above information regarding the properties you have suggested to the lender has to be verified as yes or no to the two above questions. If the answer to paragraph two is yes, they would not be appropriate properties to be used as comparables.

Since the sale price is available public ( and the livable sq feet is not). Appraisal report (done on the other property) can be used as data source for considering for comparisons (assuming similar plan..etc.)?

 

[expensiveduck]

It is very important to know what did the 1004MC say are you in a declining market, are the comparable sales you offered in the same development, subdivision and or market area? Appraiser must follow the Georgia Classification and education law of 2004 and that requires us to use sales within the development, subdivision and or market area unless we have a credible reason to expand that search? If no information is available then no information may be available- appraisers are slaves to public records! Most new homes in my area are custom built, over priced and not arm length transactions. Most have no information and no real estate agent was involved so we can not ever get second hand knowledge. We are only human!

Thanks. If the information not available public, Appraisal report (done on the other property) is also can be considered ? I want to know.... if I am able to get the appraisal report from the other buyers (who bough similar homes) in the same subdivision, can a Appraiser use that as a source for comparable?

 

[Jo Ann Meyer Stratton]

Were those homes offered on the open market? Were they advertised by the builder with a sales office or by signs out front, ads in papers, etc?

If they were not offered on the open market, they are not usable comparables.

 

[AnonApprsr]

It doesn't sound outrageous to me. It could mean your house was overvalued before or that simply there is not support for such a value as of this effective date.

 

[GeorgiaCG]

Forsyth county

There was a second question....

The answer to which would begin to tell the tale of who was involved in the alledged transactions in the previous report, which in turn would begin to shed some light on their validity...