Written by: Real Estate

A Primer on Inspections and Appraisals

We are enjoying a stable market and sellers recognize the value of making improvements to showcase the home for sale. What a pleasure for buyers and realtors alike. Thank you, sellers. On the other hand, buyers are in position to leverage for concessions from the sellers. It’s part and parcel of most negotiations. The market is afoot!

Lenders are generally conservative, and appraisals tend to come in at or just below the sales price on the contract. This means that buyers can rely on their lender to ensure they do not overpay for the home. For sellers, it indicates the need to price the home at a price that will attract buyers and meet the appraisal results.

Some sellers ask for an appraisal before listing their home, which is a good indicator of value. However, that appraisal will not be used by the lender that the buyer is borrowing from. It is interesting that the first appraisal, ordered by the sellers, tends to yield a higher price than that of the lender the buyer uses. One contributing factor is that the sales price on the contract is likely a true indicator of the current market which the first appraiser does not have access to. Also, appraisers can go only based on recent history. In any market (appreciating, declining, or stable) the buyers are the ones on the cutting edge that best understand fair market value. These are the people that go into dozens of homes before making offers. Realtors that are very active also have their pulse on the market and can give you a fair evaluation. Not necessarily the one that sellers want to hear about, however.

Inspections have recently been a source of frustration for some buyers. After closing on the purchase of their home they find problems which they felt the inspector should have found. When they read the fine print on the report…you guessed it…it’s usually not covered for damages. So, an alternative for both sellers and buyers is to have actual tradespersons do their respective inspections. Structural, plumbing, roofing, pest control, septic tanks are some of the key considerations in determining the issues in a home. It’s more expensive and will get you experts in each area to assess the situation.

All in all, it’s a normal market that allows you to buy or sell real estate at fair market value. Northerners are fleeing the winter. One such customer said this is the last winter they will spend in the North! Welcome to the city of the eternal spring and summer.

The January ramp up is behind us and coming soon is the spring and summer market. Enjoy the cool temperatures and the calm before the storm…market storm, that is.

Frank DeValdivielso, a member the Miami FL Team and The Keyes Company, is based out of 2423 Le Jeune Road, Coral Gables, FL 33134. For more information you can reach Frank at his office, 786 378 8450, or cell, 786 273 8507. You can also email him at RealEstate@MiamiFLTeam.com and please be sure to visit www.MiamiFLTeam.com for the latest listing and news regarding real estate. Call to sign up for a free monthly market report of your zip code.

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Tags: , , Last modified: February 9, 2019