Manage episode 287843392 series 2820712
Welcome back, #DealHunters! We took a quick break last week, but we're back with even more information on the real estate industry. Appraisal gaps are becoming more common as buyers look to secure a home, but should consumers be okay with the practice? Due to the low inventory across the country, buyers are finding themselves in bidding wars for homes on the market. These bidding wars are causing prices to shoot up way past the original list price, but when appraisers come in to give valuations for these properties, the appraised value of the home is coming in well below the purchase price in buyer's offers. This creates the "gap" or difference between the appraised value and the perceived value that the buyer is willing to pay. But should buyers and their real estate agents be comfortable overpaying for properties? We know the importance of buying a deal as it allows buyers to walk into their new home with equity, but a buyer purchasing a home with an appraisal gap already puts themself at a disadvantage in the event the market corrects, and the value of homes decrease. Learn more about appraisal gaps so you can be an informed resource for buyers and investors as they contemplate their options.
Mentioned in today's episode:
Here's a link to the article Donny discussed in today's episode:
What Happens If Your Appraisal Comes In Low
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