Well, the appraisal is not going to determine THE value, it's going to provide AN Opinion of Value.

Cin, I'm going to take a little of a contrarian point of view.
It's never a good idea to pay too much for a home, especially in this market.
If you will need financing, the appraisal will determine the value.
Forget Zestimate and the other public sites, they are not intended to be an exact measurement of value but merely starting points. There's a video on my website: http://firsttimehome.us that explains Zestimate.
If the home doesn't appraise, you will still have the option to buy it but you will have to make a much larger down payment if the seller won't agree to the lower price.
In previous markets, you could pay too much and be ok because of appreciation, in this market we're not likely to see significant appreciation for many years.

Tough call. Appraisals are coming in more conservative than ever before. But the answer is .... It depends.........

Is what your buying in high demand?
Limited supply?
Upcoming neighborhood, or older tired neighborhood?
What is future of this location compared to other like valued properties.
Are we talking slightly or grossly under purchase price?
If this is an investment or rental property, does it pencil?
Do you like the property, the neighborhood?
Is this a lower tax rate area? (sometimes diff tax rates will answer your question)
Is there a lot of competition, multiple offers?

If this property is really what you want, in 5 or 10 years are you going to ask yourself...."Just think we could have owned that property for under $200!!!, but hesitated because I thought I could get a better deal.

Lastly, due to tight inventory and higher demand, prices have stabilized, and in some neighborhoods, risen. Best advice I can give you is to consult your agent/broker. They will know. Good luck to you!
http://www.TemeculaTom.com
951-440-8212
Tom@TemeculaTom.com

Cin, it depends.
I'm presuming that you're in a deal for $189K, and the appraisal is coming in at $170K.
The two things you need to do are:
1. figure out if you can find an equal or better property for between $170K and $189K, and
2. see if you can get the seller to come down somewhat on the price.
You should always be looking to buy the best house for your money. If it's the best property for $170K, but it's also the best property for $189K, then it might just be that the appraiser is wrong and you should consider paying the extra money.

Dear Cin:

Are you looking on public sites, like Reatly Track, Zillow and Redfin, for your "Sold Comparable", information?

If you are, then you are getting the amounts that are recorded when the property was foreclosed on by the bank. This is because those free sites are taking any and every recording and calling it a "sale", which is not the case.

Are you speaking about actual appraisals that are completed by "licensed appraisers", or are you doing your own ballpark assumptions?

If you are obtaining financing then your lender will order the appraisal and will not loan you money over and above the appraised value amount.

Usually the seller, which can be a bank or an individual will go down to the appraised value amount but in this market these lower priced homes are being snapped up by cash buyers who realize that the market is going to rebound and they don't care about appraised value, because prices are at the bottom right now.

About Sold comparables: Consult a Realtor to find the most accurate information in "real time", about what homes have "SOLD RECENTLY", in the immediate area you are considering buying in.

Only the MLS has PURE AND ACCURATE MLS information about comparable sold property, and by the way the MLS is the main tool that licensed appraisers use when they appraise property.

Appraisers don't go on Trulia, Zillow, Redfin to get their information.

Good Luck!!!!

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Hi guys
sorry for the confusion I'm not an investor I'm a buyer that is looking at property's that are investor property's but the prices are not adding up on some of these homes me and my husband are looking to buy. what can i do if they are priced to high and don't appraise will the investor usually go down to what it is appraised. we are looking at homes in temecula this one homes price is 189,000 but around that area they are selling for a lot less. IS it wise to put more money down then what the house is worth?

Cin,

As a Investor's Realtor and Certified Buyer Specialist, I would like to first congratulate you on investing in Real Estate. I hope you have done your CAP Rate and other Chart Analysis to see whether this is a good investment compared to other properties in Temecula. In grand scheme of things, small variance of 3-8% will not matter as long as you are holding on to the property. If you will be living in or rent/flip, lot of these facts needs to be played in.

If the appraisal comes in lower, hope you can make up the difference by coming up with the amount if the negotiations does not go anywhere and the property is worth it and there are a lot of backup buyers who are excited to pick up these properties. Lots of facts goes into play. Make sure you use your agent to their fullest capability as it is a very important decision.

If you do not have a agent, I would love to help you with my team as well. I am one of the 1% GRI in the country and work for the larges Real Estate office in Temecula Valley at Keller Williams Realty.

Hope this helps. Any other questions, feel free to use Trulia or one of the professional Licensed Realtor in our community.

Here are properties that matches your criteria.

Warmest Regards,

UTPAL 'Paul' PARIKH - Certified ABR, CSP, e-PRO, GRI, SRES, REALTOR
The Utpal Parikh Group – TeamUP- Lic # 01503821

Direct: 619-990-9901
Office: 951-304-1200
Email: RealtorUtpal@yahoo.com
Website: http://www.951BuySell.com Riverside County

Investment - Commercial - Residential - Business - Rentals
Keller Williams Realty, 27290 Madison Ave, Ste 200, Temecula, CA 92590

Cin as an investor you have done your homework. You know what the AVR of the property is. You have done your numbers and know the cap rate, rate of return, and cash on cash return for the property. With having to bring more money to close the property the only nunber that will be affected is cash on cash so you have to decide if the numbers are good enough for you.

You're the investor, you - above all people - should be determining what the property is worth to you.
If you have to ask this question, you should reconsider whether you know enough about the local real estate market to be "investing" in it.

Your agent should be able to help you look at the surrounding comparable sales to help with that answer. The lending market is very tight and appraisels are very difficult right now. In our personal opinion though it may not mean that you are overpaying. Does the entire investment make sense for the time period you are planning to own the home? Can you get that same opportunity for less? There is a lot to consider. Also the appraisel is a point to enter into additional negotiations. Maybe you have already attempted that but if not have your agent go to the Seller with an adjustment to make it worth your while to complete the deal. Best of luck!