Appraisal Nightmares

Current estimates show that sales prices of nearly one in 10 new-home sales are "adjusted" prior to closing because appraisals are falling short of contracted sale prices.

John Rymer,  New Home Knowledge

Remember that low-bid or random appraisers do not make good appraisers "evil;" they simply allow lazy appraisers or those with limited knowledge of a market to become the final arbiter of fair price.

Overcome this by making it as easy as possible for an appraiser to have the best information possible. While good appraisers will look to various sources of recent transactions such as MLS, tax records and contracted builder sales, a quick appraisal process may miss several important comparables.

Place all of your sales in MLS as a central clearing house to show fair value. Developing a "mock appraisal" at the time of contact acceptance will not only help justify your price if you're asked by an appraiser for help, it will allow the builder to understand if there are underlying appraisal issues needing attention prior to starting a home.

Finally, assign one employee to work exclusively on appraisals. Having an experienced professional who is schooled in the requirements or HVCC and can provide a ready list of comparables at a moment's notice is the best way to make a compelling argument for your sales price.