Realtors worried about comps / appraisal - steering clients away

[Taylor Vick]

The market where we are has been very hot lately. We purchased a Townhouse style condo at market price in early June. It is in a great area that has been overlooked for many years - we think the area has a lot of potential. All in all, the price was very low. It had not been updated since the eighties, and even for that time it was sub par (W/D in kitchen, half size appliance, etc). We spent a few month making it very modern and attractive - moved W/D upstairs, new appliances, removed walls, refinished hardwoods, granite, new cabinets etc. This is the first condo in the development to be modernized - not a single updated one has been sold (but all look good from the outside - all brick). For our ARV we used townhouses in the adjacent developments that are slightly more modern, but priced below those.

All of the buyers realtors are looking at the previous sales in our development as comps, and saying we are over priced. More specifically, they are worried that the appraisers won't give full credit for the upgrades, and will not / may not look outside of the development to find comps (even though the others are less than a mile away). We had a girl who was head over the heels about the place at our open house, but her realtor has advised her not to put it under contract because he is confident it will get a low appraisal due to the appraiser only using in project comps (he also mentioned that it is a VA loan, and they are very strict about staying in the project).

I also believe that the realtors are not even showing this to their clients because of the above reason (though we have had about 4 showings). Do we have options besides lowering the price? We are on MLS with a flat fee agent ($200 to list and comply). How far should we lower the listing price? I am ok with a modest profit, especially because I have found an 8 plex I want to roll the money into, but I do not want to change the price too drastically.

Or should we just move to our second exit strategy - refinance and rent?  Thanks!

[Mona Lisa Harrison]

This is a situation where working with an experienced investor friendly agent can help. I have "broken the ceiling" in value of several neighborhoods. I leave my comps with the appraiser with explanations. Also, remember that about a third of properties in our market sell for cash. Across all price points. Also, listing with a flat fee agency makes a lot of agents suspicious from the get go. They may view you as a FSBO. I have respect in the marketplace and because I stage and professionally photogragh my listings, I get showings...and offers. Quickly.

Would love to chat with you about how I work.

This is a great business with great people in it.