Divulge info about properties

[Jerrad Shepherd]

I am an investor in central Nebraska and own my properties in a few different L.L.C.’s. I recently had a phone call from a guy who said he was an appraiser and he asked several questions about one of my properties so he could use it as a comp. I guess he got my number from the last real estate agent that I bought a property from. I was a little unsettled answering some of the questions about the place, that’s why I buy in my L.L.C. name and not my own. I have also had calls from out of state investors asking what my average rents, vacancy rate, numbers of rentals I have, and other relatively personal questions as well. I guess I was just wondering what kinds of questions you folks are willing to answer if any from third party people such as out of state investors, appraisers, etc. I have more or less decided from here on out that I will not be answering any of these questions because I don’t believe it is in my best interest. I am a little curious as to why someone would disclose how well their area cash flows and such if they want to continue to invest in that area without a lot of competition. Not that my area is super hot or anything. I read BiggerPockets posts everyday and have decided that I may as well start posting on here as well. What a wealth of knowledge this site is!

[Chris Mason]

@Jerrad Shepherd,

The appraiser may be trying to justify the value of a comparable. If you don't tell him all the reasons you got a screaming deal, then he must assume it was an arms length open market transaction, which in turn will mean the other home appraises low, which may mean it sells for less, which in turn means one of YOUR comps sold for less, which could impact market value of your home should you go to sell or refinance it.

I would be selective about what I would share, and I wouldn't lie, but I'd only share information that will, or could, lead to my property selling or appraising for more. 

I recently did a refinance personally, and bullet pointed out all the ways in which the listing agent did a horrible job of marketing the property, caved on price during negotiations, etc, among other things, to make the appraiser more comfy with an opinion of value significantly higher than I purchased the property for. I don't know how much of an impact it had, but the appraised value came in about where I wanted and expected it to.