Dealing With A Lower-Than-Expected Home Appraisal
You’ve made the upgrades; you’ve found a realtor you trust; you’ve listed your home and took your family out for multiple outings while strangers traipsed through your house, peeking in your closets and silently critiquing your decor choices; you’ve accepted an offer and gotten through the first bit of paperwork. And then the home appraisal is conducted. And it’s low. Lower than you expected. Lower than the offer. What can you do??
Step One : Don’t act on emotions.
We feel a little silly including this, but we’ve also “been there” as homeowners and as realtors. It’s very hard to separate out emotions from your natural reaction. This report is about your home, where you’ve presumably lived for a while, possibly raised your family, and definitely invested a good chunk of your money. It’s important to take a beat, a deep breath, and then switch over to your more analytical self.
Step Two : Realize that this happens a lot…. And it’s NOT personal.
Declining home values and cautious appraisers are causing this issue to come up more and more. So many things can affect your home appraisal. A recent article from RubyHome.com lists these items that can affect your home appraisal:
- Market conditions - hot markets & cold markets
- Appraiser shortage
- Rush jobs
- Lack of local market knowledge
- Lack of experience
- Housing crash hangover
- Bad / missed comps
- Bank-owned sales nearby
- Distressed properties
- Misallocated capital
- Disheveled property appearance
- Lazy listing agents
Step Three : Get a copy of the appraisal.
Read through this carefully, after you’ve calmed down. Check and make sure that everything is completely factual and accurate. Highlight the changes you’ve made to the property that weren’t in the original appraisal or that may have been overlooked by the appraiser.
Step Four : Talk over the appraisal with your realtor.
As realtors, we’re trained on how to handle these issues that come up with selling your home. We can sit down and review the appraisal with you. We can go over any points you have and let you know if we think it’s worth appealing the appraisal. Specifically, we want to make sure we check for any errors (square footage, upgrades that were missed, etc.) If we don’t think that the appeal will go well, we can help set that up for you and help you identify what your bottom line is on the sale of your home to see if the lower appraisal will work for you or if other options need to be explored.
Are you in the process of selling your home? Check out our recent blog posts:
- Tips For Selling Your House Over The Holidays
- A Seller’s Guide To Home Inspections
- 7 Upgrades That Will Increase Your Home’s Resale Value
- Things Sellers Do That Drive Realtors Nuts
Do you have a realtor you love working with right now? If not, give The Fairfield Team a call. We have experience navigating through every part of the buying and selling process and can answer all of your questions!