Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
How is this possible? (re: appraisal)
We finally got the results of the appraisal on the house we're under contract for, and it's good news! We settled on $295k, the appraisal came back at $336k!
I'm really surprised because the comps were all quite a bit lower. Like $200k. Granted, they aren't lakefront, and I think one of them didn't have a pool (ours is lakefront with a screened in pool). But I'm still feeling like this is too good to be true. The appraisal was done by an independent third party, through our mortgage.
I guess I just don't feel like it's real, because I had really convinced myself that the number was going to come in lower. Maybe once we're closed I'll feel better about the whole situation!
Re: How is this possible? (re: appraisal)
I'm assuming your new home is lakefront? Sometimes, especially with water front homes there is a lack of real comparable sales (homes on the same body of water, with simlar frontage, etc) and the appraiser just has to use whatever the have for SALES regardless of how comparable they really are, and make adjustments based on their experience appraising in the area.
I know locally with water front homes, sales are very few and far between and appraised values can change very rapidly depending only what there is available for sales, even more so with ocean front than lake front.
Also, do you know if the house you are buying was a second home or primary home for the sellers? I've been seeing a lot of second homes being listed low in order to sell quickly because people are having a harder time affording the payments and upkeep on a second home, and it's more of a financial risk to have two properties now.
Congrats though, it sounds like you're getting a good deal.
Do you think you are paying too much? Were you hoping to be able to negotiate lower based on the appraisal?
Generally I would think it was a good thing if the appraisal comes in a lot over asking price, because it is giving you more equity in your home. I guess I'm trying to figure out why you are upset.
I had a somehwat similar situation, although not identical. We didn't have any good comps to go on either, since none of them were very similar to our house and were all sold for lower than our purchase price. The appraisal came back at purchase price. If the house being appraised has desirable features that the comps do not have, the appraiser will add on the value of those features. In your case, the lakefront factor and the pool probably added significant value.
Why, I think this is a good news!!
There weren't any good comps for our house and the apprasial came back $15,000 above the purchase price. I honestly think the comps pulled the price down and we were hoping we'd get more equity. But hey as long as it did not go under the purchase price, it's all great!
When we bought at the beginning of this year. Our appraisal came back at $55k more then the accepted offer. We were very happy.
You got a good deal, you should feel good about it.
Oh I am definitely excited and pleased that it came back with this result! I guess I just spent the last couple of weeks talking myself out of the house, after we got hte news that the comps were so low. (Imagining that there was no way it would appraise for enough to get financing.) The sellers say they cannot go any lower without having to short sale it. So we are definitely getting a good deal, I just had myself so convinced it was going to come in lower!
This house is lakefront, and you are right, PP, that there are no lakefront comps. I just had no idea the additional value (50%) that lakefront would add. I am happy about it, for sure!
And the other thing is that this is not our first contract entered into to buy a house...we wasted a whole bunch of time on a short sale that ended up falling apart. So I'm just so exhausted of this process...thankfully, it seems to be wrapping itself up!
Thanks for the input!!