Health & Fitness
Blog: Dropping Appraisal Contingencies
In low inventory real estate markets, homes are being artificially inflated by numerous buyers leaving the appraisal values many times below asking price. Be prepared as buyers to put more cash down.
In some parts of North County, sellers are asking buyers to submit offers without an appraisal contingency. Meaning the buyer is expected to pay the difference in the appraised price and the sales price. In areas of low inventory, many homes with multiple offers are pushing the sales price beyond the comparable prices appraisals will use to appraise the home for lenders. Be prepared if shopping in one of these areas, to perhaps purchase 2 appraisals, and come up with more cash downpayment to satisfy bank requirements and obtain the new, inflated buy price.
If you are following my advice and learning through following current market trend reports, you will be able to tell which communities has low inventory and experiencing inflated sales prices. While in other communities, such as Rancho Santa Fe, it is a buyer's market, with more inventory and less buyers.
If you are looking to price your home in the current market for sale, make sure you are educated on your specific community and whether it's a buyers market or sellers market.
