Are appraisers pulling the market down?

[Ben Haab]

Is it a trend that appraisers are consistently coming in short?

Multiple offers at the same price and an appraiser won't support the price.

Full story:

Flipped 1827 Hepler Dr, Warsaw, IN (look it and how beautiful it is...)

Listed 154,900 

Under contract at 150K within a week and half after many showings and a different offer from a buyer without real credit approval. Appraisal comes back at $115K. VA buyer...dead deal, put house back on the market.

Under contract again at 149K within 2 days with a USDA buyer.  Appraisal just in at 136K.

My house: 4 bed 2 bath fully updated including mechanicals

Appraisal 1: 3 comps.  Comp 1) 3 bed 1 bath manufactured house without the title retired (so you can't get financing). Comp 2 & 3) both 3 bed 1 bath homes that weren't updated and sold a year and half ago

Appraisal 2: 3 completely different comps. Closest real comp is in the same addition but the sellers disclosure listed many defects including the roof.

My point: what is an appraised value supposed to be?

Per Google: "A home appraisal is an unbiased estimate of the true (or fair market) value of what a home is worth." If that's true then the market supports my sale price due to multiple buyers offering the sale price and very stable economy in our area.

Note: my realtor is appealing the appraisal and providing better comps, but in realty this rarely works.

[Josane Cumandala]

Full disclosure: I am an appraiser. Now, I know that not all appraisers are equally skilled and versed in their market area. There is an unfortunate practice now of "appraisal management companies" shopping for appraisers by price, going with the lowest bidder and taking a huge cut of the profits. Competent appraisers will not work for AMCs so mortgage-related appraisers sent by banks are often bottom of the barrel. That said, I often have to ask why people assume brokers comps are correct? I always take comps from brokers and they are almost never relevant. They will give me three bedroom homes when the property is a two bedroom, or use comps from a vastly superior part of town to justify a higher value. Sounds like they are trying to support a higher commission, not a better service to the public. They do not teach appraisal or comparative market analysis in real estate school. The classes you take to become an agent pertain primarily to license law, not real estate. I know this because I have been both an agent and an appraiser in my time. Before all the agents here flame me know that I respect y'all a lot. I just think agents need to educate themselves better on market analysis and the rest of us as consumers need to know how to vet an agent. As for appraisers, we will see one day just how many bad deals have gone through that shouldn't have because of AMCs but unfortunately the reasonable ones that never happened will be much harder to quantify.