The amazing bouncing home value
Most buyers probably get just one appraisal on the home they're purchasing, but Wonk reader Christina had three -- and boy, were they all over the place.
One pegged the value of her city-owned home at $115,000. The next said $60,000. The final one -- two weeks later -- was for $92,000.
That's a $55,000 swing.
It's not always easy to determine a home's value, and it's especially tricky in an uncertain environment like this one, so the answer to "why?" might be as simple as that. Real estate agents have also complained that the Home Valuation Code of Conduct -- intended to avoid conflicts of interest that led to inflated valuations in the boom days -- meant inexperienced appraisers willing to work for less money were the only ones getting any business. (The code is about to sunset now.)
Whatever the reason, you can't blame a buyer for wanting to have a solid idea of what the home they're buying is -- you know -- actually worth.
"In each appraisal the market value is different, the repairs to the property are different and the amount to make the property FHA insurable are all different," she wrote me. She wonders, "Does this happen a lot?"
Have any of you seen anything similar? What would you suggest buyers do if they're getting conflicting information about value?