What Do Midwest Appraisers Look For?

[Erik Nordgaard]

Good afternoon from San Diego, I am looking to BRRRR in Kansas City and am wondering what do appraisers look for when valuing a house in the midwest, specifically in Kansas City? Are things like location and walkability more important or do they emphasize square footage, bedroom and bathroom number, etc more? Thank you in advance.

[Laura Williams]

@Erik Nordgaard

I've been investing in KC since 2014 and I can tell you the appraisers here are all over the place. I just refinanced a condo about 3 months ago and the first appraiser appraised it for exactly what we bought it at 185K ...cause I think his MO was just to appraise if for whatever the person paid and then the second appraiser 4 weeks later appraised the exact same place for 209K.

 I've had a majority of appraisers give honest and fair appraisals but I've had a small handful of appraisers that (in my opinion) were complete idiots and unprofessional. They do things like use comps that are in terrible shape to comp to a house that was recently beautifully rehabbed or use comps from deep in the ghetto to comp a house that is in a hip trendy good area or in one case I had the appraiser use a comp from Independence MO for a house that was in South Hyde park....10 miles away and in a completely different city!!! (The bank took the side of the appraiser when I tried to contest). Also sometimes appraisers who are local will have attitude about properties that are in the metro area because those areas used to be bad 20 years and now they are great but the appraisers haven't caught up with the times in their minds. I had one appraiser give me a crappy appraisal cause he didn't like the style the property was renovated it. It was modern with concrete floors and countertops..very cool and well done but because it wasn't granite or traditional style he dinged it & made notes about it. We got a second appraisal that came in 50K more than his lowball one.

So point being it's hard to really get the appraisals down to a science because the KC appraisers  are all over the place. If you are planning to BRRR just make sure you can get a second appraisal done if you happen to get a bad appraiser. Most of mine have been accurate or about what I was expecting but I have had a few that were REALLY off & generally alot of appraisers tend to comp slightly under what the places are really worth I think to kind of cover themselves.