As both an appraiser and a real estate agent, I can safely say that appraisers often get a bad rap among the real estate community. Heck, on my really bad days, I've even been known to rip myself apart a little (sounds like someone needs a little more quality time on the couch, Doc...). But once in a while there is a magic moment when the planets align and the Real Estate Gods smiling upon the appraiser. Today was such a day. Can I get an "Amen" people?
I was recently hired by a couple in Waltham, MA who were selling their condo in a lovely old converted 2-family home. They were selling the property by themselves and were a little discouraged at the lack of activity and offers after just a couple weeks. At the suggestion of their lender, a close friend and client of mine, Seth Cohen of Heritage Home Funding, they hired me to perform an appraisal to try and help determine the most likely current market value. Just to check their pricing.
I love these kind of assignments for a couple reasons. (1) There is no preconception of the "number to hit". As much as regulations have been installed to decrease pressure on appraisers to come in at "the" value, when someone simply asks you just to "tell me your professional opinion of the most likely market value" it is a refreshingly welcoming request. And, (2) I always get to wear my real estate agent hat in the background and attempt to be the ultimate "go-to guy" for FSBOs should they decide they eventually want to list their property with a licensed agent. Give, give, give and if they become a statistic and eventually list with an agent, guess who gets the call?
Their condo was on the market for $358,800. A beautiful 2-bedroom, 1.5-bath garden style conversion unit with fantastic river views and nice period detail inside. Based on the most recent market data, my appraisal indicated the most likely market value was more like $345,000. I always cringe a little when I deliver this kind of news to homeowners. "Yeah, great place you got here, real nice, but it's probably worth about $15K less than you think it is..."
Well, the homeowners were very thankful and printed out copies of the appraisal report for the open house that Sunday. I have historically found success in using the appraisal report as a very un-sexy marketing tool. It shows potential buyers why the price is what it is. Again, none of the bells and whistles of a flashy embedded video, but it gets down to the quick 'n dirty of the pricing of the property.
Long story short, their condo went under agreement that Sunday night. Not saying the appraisal was 100% responsible for the pending status, but it had to help! When buyers see, in black and white, an unbiased analytical breakdown of the market value based on comparable sales it gives a real legitimacy to the list price. It helps eliminate some of the BS posturing and negotiating crap that tends to go on.
So where's is the sale pending you might ask? How about less than 1% different from the value I gave them at $342,000. Boo-ya! Sometimes, you just nail it. And when you do, you are the hero and they will have a hard time forgetting you. No, I didn't get the listing. They were in the minority of FSBOs who get to a closed transaction and never pay a commission.
I'm OK with that. Absolutely OK with that. I got a little business out of it. I got a $300 appraisal order. Yeah, the $8,000+ listing side commission would have paid a few more bills, but I am convinced this story is not over yet. Because most importantly I won the respect and favor of a couple of very educated homeowners who have lots of friends and know tons of other homeowners. This one will be a longer harvest. And I'm OK with that.
For now, the fruit of my labor is the satisfaction that after a careful, in-depth analysis of market data, I, as a certified residential appraiser, predicted a market value that was pretty much exactly what the market said it was. So to all the haters out there (Love you J.A., you know that, right!?!?), don't dis... don't front... and above all don't discount the value of the professional opinion of an appraiser when determining true market value!