Low appraisals can hinder real estate transactions by indicating a value less than the agreed purchase price. This affects mortgage lending, as banks finance based on the lower of either appraised value or agreed price. Factors leading to low appraisals include market shifts, insufficient comparable sales, unique property attributes, appraiser methodology, and initial pricing errors. Buyers and sellers need actionable strategies to address these challenges effectively.
A low appraisal indicates a discrepancy between the market price you've agreed upon and the value an independent appraiser assigns to the property.
Several factors can lead to an appraisal coming in low, including shifting market dynamics, limited comparable sales, and unique property features.
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