Question on Contract When Home Does Not Appraise

[Fred Lewcock]

Hello. I am not sure if this is the proper forum to ask this question.  I live in Austin and am looking at purchasing a home that has been extensively renovated. Because of the renovations, the house is now priced much higher per square foot compared to other homes in the neighborhood. We do have in the contract that I am willing to pay up to a certain amount if the house appraises lower than the sale price. But I would like to understand better what happens in this situation if appraises much lower. 

I am not concerned about my earnest money. My main concern is getting the house as this is the ideal home for me. If the house does not appraise, is the contract then technically null and void? And if so, can the seller just to decide to not move forward with my contract and find someone else that is willing to pay full price for the home?

I just want to know if there is any protection for the buyer in this situation. I want to know if the seller has to still honor my commitment to sell me the home or can they just start taking offers from another interested parties if the house doesn't appraise? 

I would appreciate any input or advice you can offer. Thank you.