Many real estate professionals have been blaming low appraisals for derailing transactions over the last few years. But now home prices are heating up across the country, are appraisals still coming in lower than the agreed-upon sales price?
Even with prices rising and the number of foreclosures falling, some appraisers say assigning a value to a property isn’t getting any easier. One of the big reasons, they say, is because of low inventories in many markets. An undersupply of available homes has prompted bidding wars above list price, a price that isn’t necessarily justified by an appraisal.
Appraisers say they are using sound data to base their valuations, including motivations of buyers and sellers.
Consumers don't always value the appraiser in a friendly light because they are the person coming in and saying yea or nay, and they've been the bearer of bad news for too many years. Homeowners don't really know where the values are. They're hearing rosy values in some markets, but not all, and a lack of real data does not support a higher appraisal.
Source: “As housing warms up, appraisers feel the heat,” The Chicago Tribune (June 21, 2013)
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