As we move into the new market with Real Estate, we are finding the prices are inching up a little. While this is great for the Seller and the Real Estate Market as a whole, it does bring it's own set of problems.
The real estate market is recovering with prices in most regions of the country showing assorted levels of appreciation. In a market where prices are escalating, the appraiser may find it difficult to find appropriate ‘comps’ for your listing. That can cause challenges during your real estate transactions as appraised values may not reflect market conditions such as rising prices, multiple bids, and low inventory.
In a recent survey conducted by the National Association of Realtors (NAR), it was revealed that:
- 11% of Realtors said a contract was cancelled because an appraised value came in below the price negotiated between the buyer and seller
- 9% reported a contract was delayed
- 15% said a contract was renegotiated to a lower sales price as a result of a low valuation
Ask your Brokers to run a Market Analysis for you on the Home that you are making an offer on to ascertain the probability of this resulting in your experience. You may loose your original offer, however, you may be in an great position for your backup offer..
I recently prepaired a back up offer for a Client in just this situation and within a couple of weeks they were in first position, as the original offer could not make it happen...So, don't be afraid to be in 2nd position.
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