Hi Korianne,

I am not an appraiser, I am a Realtor. This is a very unique market and economy. Appraisals for homes are tough right now. You do have the option of what sort of financing you will accept. An appraisal for an FHA loan will stay on the books for 6 months. If your home does not appraise for what you want the options would be - 1.) for the buyer to come up with the difference, or 2.) you reach a point in between and both the seller and buyer contribute monies to make up the difference.
From experience on recent sales the appraiser will most likely look at homes a little further back in time and farther out in area until they come up with comparable properties. I was recently told that the homes for comparables had to be no later than 60 months old and within a half a mile.

Christine

Christine McDaniel
McColly Real Estate
http://www.christinemcdaniel.com
219-730-3502

It doesn't matter if it's FHA or Conventional or even Cash. The appraiser uses sales in the immediate area (Like Same Properties & Neighborhood, also schools come into the picture). The type of financing has nothing to do with your comparables. As all have stated previously, the market today is Drastically different than 13 months ago. You are not alone here! Your problem is becoming more common than you know. If you have a Realtor, YOU and they need to step to the plate and help prove your value to the appraiser. You still might not have any luck here, but it is worth trying instead of losing a sale. Good Luck.

Korianne- If you have offers at asking price then obviously...you are priced correctly...
The FHA appraiser came in at 10% less than the purchase price. OUCH!!!
Did you ask what comps he/she used?

What recourse do you have?

You can pay for another appraisal ($200-$500) that can take at least a week...
or you may consider a less expensive 2ND opinion.
For about $30 you can go to http://www.electronicappraiser.com
This site spits out an automated valuation from electronic databases.

This may give you some ammunition to go back and question the FHA appraiser.

Good Luck!

I completely agree. A house accross the street that sold 13 months ago is not a comparison. The market is dramatically different today than it was then. It's time for everyone to come back down to reality. Never before in American history have homes sold for such a high percentage of the common annual salary. What happened was completely out of whack with logic. I'm sorry your house didn't appraise, truly. I wish you luck.

First, I'm sorry if you need the house to sell and if this would put you underwater or in an otherwise difficult state. But I actually see lender assessments as a return to standards they should have had a couple of years ago. The fact that the lender is only willing to lend 229K should tell the buyer that the market has changed and that the property is only worth that much. People have had this belief (repeated endlessly by realtors) that real estate only goes up. It doesn't. It has cycles, just like any other business. And we are in a down cycle right now.

If you can sell for close to what it's assessed at, I'd seriously consider it. Good luck.

Please consult your realtor if you are working with one, but it seems you are selling on your own. I am not a licensed appraiser in the State of Indiana, so this is my opinion only as a licensed realtor.

It is my experience that in many areas around the country (and I'm not sure exactly where Porter County sits on this), appraisers are allowed to go back 3 years on appraisals now, when no other appraisals are available. It is also my understanding that this is the same case with the FHA program. That sale near you should help.

In today's lending environment, lenders cannot have direct contact with appraisers. They simply place the order thru the system, the appraiser does his or her work, and presents it back to the lender thru the system. If the appraisal is low, the lender can order another appraisal, but usually that would be at an additional cost to the buyer. As a seller, you have little to no ability to influence the appraisal, nor could that be allowed in today's lending world.

If you are not working with a realtor, and would like to, I would be glad to meet with you and discuss how I might assist. I will be very honest with you that realtors still cannot effect change in the appraisal process. Perhaps we could meet to see how to maximize your home's value, or do a comparative market analysis, but that may be the limit. Also if you are finding buyers on your own willing to pay a strong price, perhaps thru the MLS system you can find others. But you still have the appraisal problem.

Let me know if you need any more assistance.

Best wishes,

Matt Evans
Keller Williams Realty http://www.themattevansteam.com
matt@themattevansteam.com
219-241-8401

Korianne,

Unfortunately, in today's market 13mos ago might as well be 13 yrs ago. I am not an appraiser, but according to those I hear from locally, they are looking for data no more than 90 days, more preferrably 60 days old in this market. if you look at the Indiana Association of Realtor statistics for May, you will see the prices are still falling, quite dramatically in some areas. Heres the link to my blog post with the links:
http://jjshomes4u.activerain.com/ If you paste the last link into your browser it will take you to the county by county breakdown and you can see where your area is currently.

The old cliches "price price price and location location location" hold true in most cases. Sometimes the best thing you can do is start to drop your price in $2,000 increments until you start getting showings. When you do that you will quickly find out what the current market for your house is looking for. If you were my client I would at least start at $249,900, that way you will be in another price category on allot of the search engines.

Also you didn't mention how and where your house is being marketed, but if its not plastered all over the internet, it should be, as that is where 87% of the buyers today start looking.

I think its time you have some serious dialogue with your agent and hammer out where you go from here.
Jody