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- Category: Market Updates Market Updates
- Published: 06 February 2010 06 February 2010
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Distressed Realty Sinks Appraisals
Making the front page of the Idaho Statesman on this Saturday morning, Feb. 6, 2010, was this article.
When contacted by the reporter for my opinion for her article, I was somewhat skeptical because you never know when the newspaper will quote you right or place your comments in the right context.
Though only a portion of my comments were used, I will say, she published it accurately.
"The appraisers need to take a look at making adjustments for non-distressed properties. Too-low appraisals can kill traditional sales, while too-high ones can kill short sales."
My professional opinion is that distressed properties should have an adjustment in the appraisal to differentiate their value, due to the "hassle" of waiting for a short sale and the fact they may actually sell for less than market value.
When a majority of the market is comprised of distressed properties, these lower values may drive the market and actually BECOME the market, however, if we continue on this trend, there may be no recovery from a continuing downward slope of home values.
I know there are buyers out there who want to avoid short sales because of the long wait and therefore, they may be willing to pay a higher price for a non-short sale property. With our current trend of appraisal methods, they are often buying a non-short sale property for a short sale price without the wait. This doesn't seem quite fair to the seller who is not distressed.
I think you can see where this could possibly lead.
Any thoughts from what appraisers are doing in your area? Let me know. We need to stop the huge snowball from rolling to the bottom of the hill & taking all of our equity with it!
It's a great time to buy homes in Boise and homes in Nampa... For Idaho real estate, give me a call!
