Peter Mohylsky, Let me help you find your path to the beach.  (PrimeSouth Properties)

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Rainmaker
2,826,031
Kathleen Daniels
KD Realty - 408.972.1822 - San Jose, CA
San Jose Homes for Sale-Probate & Trust Specialist

Oh my!  If that isn't a twist on a tale of a listing agent.  

Did you receive "market value" for your home? Was it in alignment with the comps we discussed? 

I'm curious, if the value had come in equally low, would you be wiling to lower the price to the appraised value?  

Question to you Peter Mohylsky = what comps did the appraiser use to come back with a higher value? 

Oct 20, 2017 03:25 PM
Ambassador
3,440,887
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

1.  Did you receive multiple Offers? Did it sell Day-0 on the market? If not, it wasn't priced too low. 

2.  The SELLER sets the price, not us - we are marketers. YES, we share comparables with our sellers but, they are also told that they can certainly have an appraiser's valuation to confirm our CMA.

3.  EVEN if she got an appraiser's valuation, RARELY do two appraisals come in the same value. I recently had to have a second one - the first one was low. The second appraisal came in $22,000 higher than the first one.

Share those with her, Peter. It stinks when this happens but, you've got this!

Oct 20, 2017 03:35 PM
Rainmaker
3,424,914
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

The buyer pays for the appraisal and unless there is an issue(typically occurs when the appraisal does not meet the purchase price) the conversation between buyer/selling agent/buyer's lender and the seller/listing agent -- "appraisal is good".  

An appraisal is an opinion of value - granted by an "expert" in the field...but you know what they say about opinions...

Oct 20, 2017 04:25 PM
Rainmaker
547,192
Eve Alexander
Buyers Broker of Florida - Orlando, FL
Exclusively Representing ONLY Orlando Home Buyers

An appraisal is an OPINION of value.  It is not science.

Give it to 3 appraisers and "opinions" will not be the same...maybe down to even less than the purchase price.

She needs to be glad someone saw value in her home.

Eve

PS: whoever gave her the appraisal was stupid...

 

Oct 20, 2017 03:35 PM
Rainmaker
748,419
Candice A. Donofrio
Next Wave RE Investments LLC Bullhead City AZ Commercial RE Broker - Fort Mohave, AZ
928-201-4BHC (4242) call/text

First I would want to SEE the appraisal.
Folks often 'read in' instead of 'reading'.
There are several methods used by the appraiser to determine value and I want to be able to understand how he derived value.
Is it in appreciating market?
What comps did the appraiser use?
HOW high is Way High? 20% 5%
Time for Jeopardy!

Oct 20, 2017 03:31 PM
Rainmaker
1,657,788
Bob "RealMan" Timm
Ward County Notary Services - Minot, ND
Owner of Ward Co. Notary Services, retired Realtor

I'd be calling the appraisor and asking what he/she used for comparables Peter Mohylsky . I would show the client those comparables and mine and explain why mine were more accurate than theirs.

Oct 20, 2017 05:27 PM
Rainmaker
1,262,912
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

What idiot sends in a higher than asking appraisal to the seller?  Or anything to the seller directly.  It should have gone to you if anyone on the seller side.

 

I'm just amazed something came in well OVER asking!  Usually it's at or well under.  I had a house that just closed.  It was in escrow twice and had two different appraisers within a week of each other.  First one brought it in at asking, second $20k under.  No rhyme or reason.  Same SF, Bedrooms and comps.

 

I'd ask her how long it took to get a buyer.  If it wasn't lightning fast, you're not priced low.  Low prices generate (at least out here) 10+ offers in the first day, many site unseen.

Oct 20, 2017 05:23 PM
Rainmaker
1,109,038
Anthony Acosta - ALLATLANTACONDOS.COM
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

Don't know how the seller would come across an appraisal report that is paid by the buyer?????????????????

Oct 21, 2017 06:11 AM
Rainmaker
3,209,902
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

This is a new one on me... I haven't seen an appraisal come in way high over a contract price in more years than I can remember. I'd tell that seller that an appraisal is one person's opinion and that another appraiser could come in and value the property below the contract price.

Oct 21, 2017 04:33 AM
Rainmaker
705,151
Richard Bazinet /MBA, CRS, ABR
West USA Realty - Scottsdale, AZ
Phoenix Scottsdale. Sellers, Buyers & Relocations

Oh shit...

It does not matter what the explanation is. The seller now believes that he/she sold the property for too low, i.e. and came short on the proceeds. You don't want this to turn into an errors and omissions situation or negligence matter.

I would think about this VERY carefully, prepare your research, numbers, comps, analysis, againts a detailed review of the appraisal in support of your position and advice you provided. I would even suggest you consult the appraiser. 

Perhaps ask a colleague, maybe two at the office to prepare independent comps reports on the property.

I would suggest Peter to get into a 'cover your a$$ mode".

This may be an overkill, but it's to better be prepared with facts and numbers and find the error(s) even if it is the appraisal that's wrong.

Oct 20, 2017 10:36 PM
Rainmaker
582,467
Steve Higgins
RE/MAX Kelowna - Kelowna, BC

Debe Maxwell, CRS and Bob "RealMan" Timm both had good comments.

 

Oct 20, 2017 06:34 PM
Ambassador
1,665,460
Alan May
Jameson Sotheby's International Realty - Evanston, IL
Helping you find your way home.

An appraisal is just one person's opinion of value.  It rarely has anything to do with "what we could sell it for" which is often different than how the bank values it.

Oct 20, 2017 04:53 PM
Ambassador
2,363,840
Fred Griffin, on leave of absence from ActiveRain
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

     Was it a local appraiser, with good comps?

       If it has not closed yet, tell Seller she can consult a real estate attorney about breaking the contract.  Then put the house back on market at a higher price.   

Oct 20, 2017 04:05 PM
Rainmaker
5,118,200
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

as Eve said, appraising is not an exact science....there are variables.... there could be a 3 or 4% variable in our area.... 

Oct 20, 2017 04:04 PM
Ambassador
3,061,419
Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

I would say we have good news. No reason to worry about the appraisal anymore. We are one step closer to moving forward!

Make it positive news.

So much better than an under appraisal!

Oct 20, 2017 09:09 PM
Ambassador
3,983,649
Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

I never see the appraisals even those of my buyers. I would explain that appraisals are subjective and isn't it wonderful it came in supporting the sales price versus several thousand under. It can be a roll of the dice and create tons of problems.

Oct 20, 2017 06:38 PM
Rainmaker
478,811
Diana Dahlberg
1 Month Realty - Pleasant Prairie, WI
Real Estate in Kenosha, WI since 1994 262-308-3563

Our job is to evaluate our current market by doing a market analysis.  You can have 10 appraisers and it is not uncommon for all ten to have a different opinion and/or to come up with different price points.  If we present the information to the seller and they agree to a price ... that is a concerted effort on their and our part.  It's also in the eyes of the "beholder" -- the buyer.  But ultimately the appraiser.  So for all intents and purposes the seller agreed on the price the buyer offered.  There should need to be no further discussion.

Oct 20, 2017 05:35 PM
Ambassador
4,366,316
Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams Fox Cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Really puts you in a tough position.

Was the Appraisor using Zillow?

 

Oct 20, 2017 05:34 PM
Rainmaker
5,500,927
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Be thankful for a high appraisal rather than a low one.

Oct 20, 2017 05:08 PM
Rainmaker
1,019,986
Kevin J. May
Florida Supreme Realty - Hobe Sound, FL
Serving the Treasure & Paradise Coasts of Florida

The evidence generally shows that the appraiser is frequently not knowledgeable about the local market. This would not have become an issue without the implementation of the Dodd-Frank Act. I have fought a few with substantial direct comparables to no avail although it does prove my valuation to the Seller. Whether low or high I cannot understand how a lender can substantiate an appraisal written from a desk 200 miles away from the subject property.

Oct 20, 2017 04:53 PM
Rainmaker
2,484,123
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Appraisals are only good for a certain time and space. Secondly, another appraiser might come in low or the same. Thirdly, the idea is to get in and out of the transaction effectively and efficiently. Acts of God, market changes, economic laws, new rules and regulations etc. can take it south quickly thus get in and then get out of the market. Fourthly, you cant lose money you don't have. Fifthly, a bidding war or multiple offers would have proved the point. Lastly, it is a sticky wicket of a sort and a valid question 

Oct 20, 2017 03:31 PM
Rainmaker
1,270,938
Sheri Sperry - MCNE®
Coldwell Banker Residential Brokerage - Sedona, AZ
(928) 274-7355 ~ YOUR Solutions REALTOR®

I wrote a blog about Pricing and the answer is under positioning. 

How would your client like to take it off market and put it back on market for the higher price? Probably not willing to do that! A bird in the hand.....

Oct 21, 2017 12:28 PM
Rainmaker
1,559,010
Sandy Padula and Norm Padula, JD, GRI
HomeSmart Realty West & Geneva Financial, Llc. - Carlsbad, CA
Presence, Persistence & Perseverance

Not enough info; was it a recent high sale that skewed the numbers? Bottom line; the market determines the price and it is in constant flux.

Oct 21, 2017 08:09 AM
Ambassador
4,068,122
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

What is WAY high? Did the property sell immediately? Lucky it was not the other way around.This is but one opinion of value. I like Kathleen Daniels ' response

Oct 21, 2017 08:02 AM
Rainmaker
4,797,822
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

I have not had this happen, ever.

Oct 21, 2017 07:22 AM
Rainmaker
1,384,027
Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Peter Mohylsky I had listed a home that just wasn't selling. The seller finally agreed to reduce the price $10,000. The house sold in a couple of weeks. We were sitting at the closing table with the buyers. The closing attorney congratulated the buyers and told them what a good deal they got because the appraisal came in $10,000 over the selling price. If the seller's looks could kill, I wouldn't be here right now. It was a very uncomfortable situation. I never use that attorney again.

Oct 21, 2017 06:48 AM
Rainmaker
1,557,394
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Real Estate

I can see where that could be a problem opposite of what we normally have. Just an opinion of price & the buyers lenders version at that.

Oct 21, 2017 06:17 AM
Rainmaker
569,260
Nathan Gesner
American West Realty and Management - Cody, WY
Broker / Property Manager

Let her list it at the higher price and see what kind of action she gets. When she comes back to earth, try it again.

Oct 21, 2017 05:59 AM
Rainmaker
3,363,469
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Since an appraisal is an opinion, I'll stick with mine!

Oct 21, 2017 05:54 AM
Rainmaker
846,015
Marco Giancola
Beachfront Realty - Miami Beach, FL
Realtor (305)608-1922, Miami Beach Florida

Hey Peter-we are so used to the opposite situation so this scenario can be intense. It happened to me once and I suggested the seller get their own appraisal done as it is called "an opinion of value". They opted out and we closed at the contracted price.

Oct 21, 2017 05:48 AM
Rainmaker
576,879
Gloria Valvasori, Accredited Senior Agent
BETTER HOMES AND GARDENS REAL ESTATE SIGNATURE SERVICE - Mississauga, ON
REAL Experience | REAL Commitment | REAL Results!

It's the market that sets the price, not the appraiser, not we as agents.  A property is  only worth what a Buyer would pay for it.   If you used the appropriate comps to arrive at a listing price, then perhaps the appriaser is being a litle too optimistic, and who knows what comps he used. Appraisers aren't always right as I have found out many times.

Oct 21, 2017 05:47 AM
Rainmaker
3,054,229
Tony and Suzanne Marriott, Associate Brokers
Haven Express @ Keller Williams Arizona Realty - Scottsdale, AZ
Serving Scottsdale, Phoenix and Maricopa County AZ

Debe Maxwell, CRS nailed this one!

Oct 21, 2017 05:05 AM
Ambassador
1,655,691
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

It's nice to hear about an appraisal coming in highr instead of low.

Oct 21, 2017 04:04 AM
Rainmaker
940,685
Thomas J. Nelson, Realtor e-Pro, CRS, RCS-D, Vets
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

It seems suspicious that the seller got a hold of the appraisal without your knowledge. The seller chooses the price based on the market data, so while that's a natural reaction, despite the mystery, the seller chose the price and an appraisal is one person's opinion which can vary.

 

Oct 21, 2017 12:12 AM
Rainmaker
4,570,639
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Peter,

This has not happened to us, and I agree with Michael Jacobs wise words.  A

Oct 20, 2017 08:19 PM
Rainmaker
1,034,843
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

What is your CMA comp in relation to the appraisal?   I am good enough and my value is very different from other appraiser's value.

 

Oct 20, 2017 03:53 PM
Rainmaker
4,432,467
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Good luck.

Oct 20, 2017 03:46 PM
Ambassador
4,301,228
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

That always happens in the buyer is strong.

Jun 29, 2018 11:30 PM
Rainmaker
4,160,154
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

On our listing side, the most we ever get is - it came in at contract price.  Interesting your Seller got a copy?

Oct 25, 2017 11:18 AM
Rainmaker
3,240,112
Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Wow,  how did she get the copy?  that is weird.

 

Oct 23, 2017 10:19 AM
Rainmaker
109,494
Marie-Denise Kratsios
Daniel Gale Sotheby's International Realty - Huntington, NY
Where ever you are, that's where I'll be!

As a listing agent, I always meet the appraiser at the listing and show them the most recent comps, which they always appreciate.  Regarding the homeowenr, I would review the comps with her and point out (as others have said) that appraisal estimates can vary a great deal.  

Oct 22, 2017 08:41 PM
Rainmaker
758,662
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

They agreed to the listing price when they signed the listing agreement. Appraisals are flexible values. What do the comps on the appraisal say? Are they all above the " subject" property?

Oct 22, 2017 04:33 AM
Rainmaker
633,956
Kathleen Luiten
Resort and Second-Home Specialist - Princeville, HI
Kauai Luxury Ocean Home Sales

I've never had that experience. A little high or a little low is what I've seen and that's not hard to explain to the parties.

Oct 22, 2017 01:46 AM
Rainmaker
744,655
Olga Simoncelli
Veritas Prime, LLC dba Veritas Prime Real Estate - New Fairfield, CT
CONSULTANT, Real Estate Services & Risk Management

What do you think?

Oct 21, 2017 07:14 PM
Rainmaker
780,523
Annette Lawrence , Palm Harbor, FL 727-420-4041
ReMax Realtec Group - Palm Harbor, FL
Making FLORIDA Real Estate EZ

That is the trap set for us when we ascribe to the "reduce the price' stategy promoted by some franchises. This seems to drive the need to create bandwidth for more transactions available with quick sales.

IN this case all the agent can do is remind the seller they were advised, while seated at their dinning room table, that a pre-inspection and appraisal was advised. 

Of course the appraisal itself may be in error with comps from more favorable communities.

The real issue in a faulty appraisal case is do you remain silent and let the buyer believe they have instant equity or sound the alarm, sink the deal and have some 'splain'n' to do.

Oct 21, 2017 07:30 AM
Rainmaker
3,050,043
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

The seller should not receive a copy as it is the buyers, but i have had this happen, One lady who insisted we list way high, we did and no one came. It was a divorce so she wanted her agent but the court said the Mr chooses and that was me. After some time, the Mr got involved, we rduced to where it should be and got multiple offers and a sale

Oct 21, 2017 05:02 AM
Rainmaker
3,983,713
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

I would question what comps the appraiser used.

Oct 20, 2017 08:29 PM