While I did not intend to talk about refuting appraisals today, I just had an appraisal go poorly on one of my listings. It came in low and now I have to try to correct this situation if possible. So, I thought I would give you a behind-the-scenes look at how a real estate agent can refute an appraisal for you.
The way that we get an appraiser to change an appraisal is by being diplomatic and polite. We have to put our concerns and reasoning into a letter where we cite evidence to convince the appraiser to our way of thinking. There are three specific areas of the appraisal to look at.
1. Did the appraiser pick appropriate comparables? Comparable homes should be the same size, age, neighborhood, quality, and condition. With regards to the home I recently sold, I believe this is where my appraiser made a mistake since my home was in very good condition and the comparable properties he chose were in average condition. I will need to present him with some alternative comparable properties so he can increase the value to what it needs to be.
2. Double-check the facts. I am going to check through everything to make sure everything is quoted appropriately, including square footage, the room count, the bathroom count, the lot size, if there is there a fireplace, etc. If there is an error here, it could help us move closer to the value we expected.
3. What are the adjustments? With an appraisal, you have comparisons between the subject home and the comparable homes. However, no two homes are exactly alike. Just because my home does not have a rec room does not mean that it is worth $10,000 less. I must make sure the adjustments are accurate and reasonable for the current market.
Once I analyze all of this, I will write a formal, diplomatic letter where I request politely that he reconsider his position.
If you have any questions or are interested in buying or selling, please feel free to contact me. I would be happy to speak with you.