Re: Establishing real estate value - Posted by Tom Brown
Posted by Tom Brown on November 17, 1998 at 13:13:15:
How old is the appraisal? Generally, anything older than 6 months to 1 year, depending on how hot the market is, is considered outdated.
How experienced is the Realtor and where are the comps located in relation to the subject property.? How do the comps compare in style, size, condition, etc. to the subject property without any adjustments?
Is the neighborhood changing or has something happened to the property recently that could change its value?
I really hate answering a question with more questions but you need to consider the answers in determining the accuracy of the two ESTIMATES. Both the appraisal and the market analysis are only estimates of the properties value. The real value is how much someone is willing to pay.
All that said, all things being equal, if the appraiser is certified/licensed and experienced I would tend to look more at the appraisal IF it is current. Not so much as a rock steady number but more as a general guideline. If the appraisal is outdated and a bank is involved with new financing, you are going to have to get another appraisal anyway. Remember, bankers couldn’t care less what the Realtor thinks it is worth.
The best thing to do would be to look at the reason why the numbers are so different. There must be something going on to affect the estimated value of the property so drastically.
I know that that is not a concrete answer, but I get the feeling that something is going on and you need to dig a little deeper into the situation.