A common theme being seen in real estate sales today is the widening gap between what the seller bottom line for their property is and what lender’s are willing to appraise the value of the home at. The housing market is trending to a lower supply ratio when the demand for purchases are steadily increasing. People are trending from renters to home buyers thus compounding the need for the gap to close. One major challenge in such a market is the bank appraisal.
If prices are surging, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that closed recently) to defend the price when performing the appraisal for the bank. Every monthlenders measure the disparity between what a homeowner believes their house is worth as compared to an appraiser’s evaluation in their Home Price Perception Index (HPPI). KCM Crew illistrates the below chart showing that difference for each of the last 12 months.
The gap between the homeowner vs. appraiser’s opinion had been heading in the right direction (closer to even), until this past month, when the gap widened again to -1.99%.
According to KCM Crew, every house on the market has to be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices, the second sale might be even more difficult than the first. If you are planning on entering the housing market this year, meet with an experienced professional who can guide you through this,and any other, obstacle that may arise.
EXIT Realty Champions', Champions Gate Real Estate Office, by Reunion Resort Orlando, is a full service Real Estate Brokerage Office in Champions Gate, Davenport 33896, next to Reunion Resort in 34747. Search for homes for sale with our Realtors, local experts in Champions Gate, Reunion Resort, Kissimmee and Davenport FL. This being the main area for resort vacation homes that can be rented out to meet the Disney World Orlando>, Universal Studios and other theme park market.
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