Florida Appraisals - Big Deal?

Question

Hello friends,

I'm trying to make an offer on a triplex with FHA financing. My realtor is convinced it won't appraise for full price, which is what I'm offering with 3% closing assistance as this is a triplex built in 2004 and it will be my primary residence. She's said it several times:

"I don't think this will appraise at full price.  I would hate for you to incur the inspection fee and appraisal fee and have the seller not be willing to reduce to appraised value if that was the case."

In Iowa, where I moved from, appraisals are taken with a grain of salt because they almost always magically come back at what the sale price is.

Is that not the case here in Florida?! Someone help me out...

(Jensen Beach, Stuart, Ft. Pierce, St. Lucie, Treasure Coast, S. Florida, West Palm)

John Kent · Answer

Account Closed

When it comes to appraisals in Florida underwriters heavily scrutinize the comps and the valuation. I would suggest asking your agent to pull comps for you.

You may wish to consider having your agent add a clause to the contract that would reduce the purchase price to the appraised value should the appraisal come in lower.

Account Closed · Answer

@John Kent I have that clause! Thank you for the info on the underwriters!

Carlos Fernandez · Answer

Appraisal shenanigans like what you may have experienced in Iowa led to a massive market crash that wiped out the fortunes of millions of people. It truly devastated the region. Nowadays, appraisals are taken very, very seriously. Listen to your agent and let the buyer know that you simply canNOT pay more than the appraised value.

Having said that, what a lot of ppl do is they leave money in reserve out of sight of the seller, so they need to sweeten the deal, they can do so. But don't overdo it! When we bought, we essentially paid the seller's closing costs b/c he was going to back out of the deal, and we got an insane deal on a property that has doubled in value in just a couple of years.