Bad appraisals on BRRRs

[Jim D.]

On the last BRRR I did, I purchased for $85k (great cash discount) and spent $20k on the rehab. I had my ARV estimated between $140-150k; this is in a neighborhood I am very familiar with, and I had a good list of comps putting it in that ballpark, so I wasn't worried about the appraisal at all.

The appraiser came through and took less than 10 minutes at the property, barely looking at anything and just snapping the photos he needed. The only questions he was interested in were "So you bought this off the MLS?" and "How much total did you spend on the remodel?". The appraisal comes back, and what do you know; he independently determines that the market value just happens to be $105,000 (the exact amount I spent). I showed the property and appraisal to some other investors that work in the area and all agreed the property wouldn't have any trouble selling for close to $150k.

In the end, I appealed and got it up to $145,000, but this has happened to me twice in a row on BRRR appraisals. The appraiser just wants to add up what I spent and use that as the value. How can I get an appraiser to just use the comps and market data for valuation, instead of taking this cost approach?

[Russell Brazil]

Your profile says you are an agent. Have you ever taken any classes or trainings on how to get a house to appraise? This is one of the most important skills an agent should have.