Low appraisals continue to thwart deals

Tough spot for Banks, Appraisers, and Us.

Appraisals are the governor of price. Banks are less inclined to risk reaching for a contract price that’s a bit higher than the appraisal although efforts were understandably made to do just that when we were in an appreciating market. Across Clearwater, St. Pete, Tampa and America banks are now much more conservative lenders. Their rationale and valid heightened concern is the fear that in this tenuous recovery, the borrower, in a year or two, could easily wind up unable to make mortgage payments. If forced to foreclose on the property, the bank needs to be confident that the property will sell quickly and not for a loss.

As for appraisers, they are having a tough time evaluating homes because of all the short sale and foreclosure data in the mix. An unstable market makes for pinpointing true market value a moving target. It is indeed a thankless job for appraisers under current conditions.

And, we real estate agents must keenly know the neighborhoods and frequently we need to shine a light on the subject property’s upgrades, etc., as compared to other recently sold homes. And, often, we must locate better comparable houses and sometimes even request/demand another appraisal.

What a difference a few years makes.

But at least sales of Tampa Bay real estate have put in a  bottoming process in the last year and a half.

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Paul and Debbie