'PRICE' is simply a number represented in dollar terms attached to a home. 'VALUE' on the other hand is determined only by market forces of supply and demand. If supply is constant, then higher demand = more 'VALUE', less demand = less 'VALUE'.
Here's the rub - ARTIFICIAL demand was created for years by a low interest rate policy by the Federal Reserve and easy credit requirements by banks and mortgage companies. It was nothing short of a 'MONEY PARTY'. Virtual 'free' money was available to everyone - but was this 'real' ?? While 'VALUE' remained relatively constant in real terms, 'PRICING' was incredibly inflated by artificial demand. The 'MONEY PARTY' is over now.
Housing 'PRICES' are now falling to their equilibrium point - based on true market 'VALUE'. Banks are acutely aware of the PRICE/VALUE paradigm and in many cases, it is at odds with current 'LIST PRICES' and buyers 'OFFERS'. And needless to say, many homeowners are caught in a bad situation.
You left some important information out of your story:
Red Hook has some homes at $9,000,000, and the have some homes at $290,000.
If you have a $5,000,000 home, then $150,000 is only 3%.
But if you have a $300,000 home, then it is $50%
You can see how that would impact your story.
If you had three Realtors give you similar values, then they must have done CMA's to arrive at their numbers.
You didn't say that either; but I will assume.
I am also going to assume that you do not have a cheap house; but rather, something above the median.
It is possible and very likely that you have an anomaly; hard to value, hard to appraise, hard to sell.
Please do not take this out on your Agent.
If this is the situation; you will have to exercise greater patience.
And no, we have not seen Appriasers and BPO excluding Distressed sales from their computations: This makes it harder for the Normal sales to be valued, particularly the higher end sales. Since Distressed sales encompass 70-80% of all sales, they cannot be ignored, making to more difficult for you.
Your Buyers simply have to understand this.
Good luck and may Gopd bless
I'd love to see how this plays out: Any chance of letting us know when it is listed again Barbara?
A quick answer to your question is the value of a home is determined by what someone is willing to pay for it. Comparables help sellers and agents aggressively price a home in the market. It is usually considered overpriced if it just sits there, but having gotten an offer for close to the asking price would have one assume it was fairly priced in the market. The fact that not one, but two, banks low balled the price brings up some questions. What is unique about your home? How much work needs to be done on it? What comps did the banks use? A home that is unique, whether by structure or by location is difficult to appraise. My recommendation would be to hire a certified NYS appraisor before putting your home on the market again. I wouldn't necessarily blame your agent. With this rapidly changing market, it is difficullt to keep a pulse on price on a monthly, weekly or even daily basis. A few years ago my husband and I were selling our custom built log home. Most people, banks included, don't understand the value of log homes. It took quite a while to sell it, but we eventually got the asking price. One of the problems was that banks from Westchester, not Dutchess were doing the appraisals. Once we hired our own appraiser from Dutchess and had a point by point breakdown done, we had no problems. Things are done differently in different areas. I always recommend to my clients/ customers to wrap themselves around professionals in the area where the home is located as this helps to expediate the selling/buying process and it is done more fairly with a great deal more knowledge and understanding in all areas. Good luck. If I can answer any other questions for you, please don't hesitate to contact me. Thanks................................Margo
I am sorry you experienced such disappointment and angst. I agree with Carol about your property perhaps being unique and few comps being available. I would also suggest obtaining your own independent appraisal from an appraiser in your area to assist you in pricing, explaining the circumstances leading up to this. I wish you the best.
There is a lesson to be learned in a constantly changing real estate market and thst is the home values are changing almost daily.
The next time through we recommend having an appraisal done up front so prospective buyers will have a reference point. Remember this appraisal may only be considered good for 4-6 weeks but it will provide a reference point for buyers, keeping them in step with current and acceptable pricing.
I don't know what the issue was, but it sounds like we are missing some information here.