Real Estate Info

The home appraisal. Over the last few years, it seems that home appraisals have come to be talked about even more so in this real estate market. With home values across the United States falling the past few years, it has become ever more present on the minds of future home buyers and current home owners.

From about 2000-2005, many parts of the real estate market here in the US saw extremely high levels of home appreciation. With such rampant appreciation, many home appraisers felt a certain push by the mortgage companies to hit a certain price in their appraisals. Over the years, our real estate team here in Minnesota has seen numerous occasions where appraised value and market value seemed to be two contrasting numbers.

Naturally, as a consumer, this seems extremely odd and perplexing. One would think that the appraised value of a home for sale would in fact be the value at which that particular property would sell. However, during the housing boom of the early 2000s, some appraisers certainly did in fact feel a certain pressure to appraise homes at particular prices. For example, it was written in various publications that if a certain appraiser had a large account (mortgage company) that provided a certain number of appraisal orders, that appraiser wanted to keep that account happy.

Now that the real estate values have fallen in 2006, 2007, and 2008, and banks have taken on tremendous losses around the country, the emphasis has come back to accurate home appraisals. With so many banks receiving homes back through the foreclosure process, they have felt the pain what inaccurate appraisals can in fact bring about. For this reason, our team has noticed a much more conservative approach to appraising homes in this market.

And this is in my opinion, a very good thing. The foreclosure and massive losses banks have taken in recent years have brought real estate markets back to what a consumer should be able to count on for a home appraisal. If an appraisal is done on a home, and the value comes in at $200,000, then that seller should be able to sell that home for $200,000. There should be no “pressure” that an appraiser feels to appraise a property for a certain value. This creates an uncomfortable environment for the appraiser and an inaccurate sales price for the home seller and buyer.

Home appraisals in 2008’s real estate market are moving back to where they belong: accurate numbers buyers and sellers can count on!

Ryan O’Neill is a licensed agent with RE/MAX Advantage Plus. As the founder of The Minnesota Real Estate Team, Ryan and the team help clients buy and sell Minneapolis Homes and Minneapolis Condos.

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Tags:foreclosure · home appraisal · home buyer · home for sale · home seller · mortgage · property · Real Estate · real estate market No Comments

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