Really really really low appraisal

[Lance Dutson]

Hi all - First post here, but wanted to thank everyone for all the great advice in these forums.

I'm looking at purchasing a lakefront property in rural Maine. We've worked through the process for months and now, about 10 days before closing, the appraisal has come back more than 100k less than the sales price. ($350k sales price, $241k appraisal value)
The market is very hard to judge, because of a total lack of comparable sales in the same town. This is a property about 6 miles from a major ski resort area, and the pandemic has driven sales in tourism areas of Maine through the roof. Example: median sales prices for properties in Maine were up 15% last year, in the county we're looking to buy, they're up 31%.

The appraisal used comps roughly 40 miles away, outside of the mountain/tourism area, closer to some fairly depressed, more densely populated areas. The homes were also waterfront and shared some similarities, but they just were not at all similar in market to where we're looking to buy. There is a similarly tourism-focused area to the west of the subject property (and closer), and we were able to find a significant number of comps there that justify the sales price of this existing property. We have submitted these new comps, and an overview of the reasons we think the other comps were poorly chosen, in an appeal to the bank, and are waiting to hear back.

Normally such a low appraisal would give us pause about our offer on the property. But we've been researching similar properties for years, and felt very solid on this one. The property was actually not on the market, we convinced a reticent seller to sell to us, and have felt we were lucky to grab this one at the beginning of a significant market increase.

I wanted to share this and see if folks had thoughts they'd be willing to share. I'm very pessimistic about our prospects because of the massive discrepancy, if it were 10% or so I could see an appeal working, but $110k is a pretty major mountain to climb through an appeal process. We also found a number of factual errors in the appraisal -- wrong number of bedrooms, wrong number of fireplaces, a stand-alone workshop that was missed altogether, etc. So we believe this was just a totally botched appraisal, but we're new to this and might be thinking with our feelings rather than our logic here. 

Any input or strategies would be much appreciated!