Appraisal gaps occur when a home's appraised value falls below the purchase price, a significant issue in competitive markets like Los Angeles. Buyers may need to cover the shortfall or renegotiate with sellers to successfully close a deal. Common causes include fierce competition leading to inflated offers, rapidly rising prices not reflected in appraisals, and unique home features that complicate comparisons. Understanding these dynamics is essential for buyers to navigate potential appraisal gaps effectively and avoid losing earnest money in the process.
An appraisal gap occurs when a home's appraised value is lower than the purchase price, complicating the buying process and potentially causing financial challenges.
Bidding wars often drive prices above appraised values, leaving buyers to cover the difference out of pocket or risk losing their earnest money.
Factors such as high competition, rapidly rising prices, unique home features, and emotional bidding can all contribute to appraisal gaps in real estate.
In competitive markets like Los Angeles, appraisal gaps necessitate negotiations between buyers and sellers to find a solution before closing a sale.
Collection
[
|
...
]