You're facing challenges with property appraisals. What strategies can you use to overcome them?

Use low appraisals to your advantage: A low appraisal isn't always a bad thing. It can indicate that you're not overpaying for the property. Use this as leverage in negotiations to potentially lower the purchase price or renegotiate terms Familiarize yourself with the key factors that influence appraisals, such as location, comparable sales, property condition, and market trends.

Je conseille de regarder la méthode d’évaluation utilisée par l’expert. Pour l’approche par comparaison : étudier les comparables retenus par l’évaluateur est indispensable. Il faut s’assurer qu’il s’est appuyé sur des biens équivalents. Pour l’approche par le revenu : étudier les paramètres d’évaluation, notamment la valeur locative de marché, le taux de rendement, les plus ou moins values locatives et les travaux. Quand je relis l’expertise d’un confrère, je vérifie également les données utilisées : les transactions retenus sont-elles suffisamment récentes ? L’expert a-t-il pris en compte le contexte actuel du marché ? Je tente au maximum de comprendre les hypothèses retenus par l’expert.

One of the first strategies to overcome property appraisal challenges is thoroughly understanding the process. Appraisals are grounded in data-driven analysis, with appraisers evaluating recent sales of comparable properties, current market conditions, and specific characteristics of the property being appraised. Location, square footage, condition, and unique features contribute to the final valuation. By understanding how each of these components influences the appraisal, you can better anticipate potential issues and prepare relevant data. This foundational knowledge makes it easier to address potential discrepancies or areas of concern later in the process.

After receiving the appraisal report, carefully review it for accuracy. Confirm the property details, such as square footage, condition, and features, ensuring nothing is overlooked. Pay close attention to the comparable sales used—check if they are truly similar in location, size, and condition. Evaluate the adjustments made for differences between properties to see if upgrades or unique features were properly accounted for. If any details seem incorrect or unclear, ask for clarification. A thorough review ensures the appraisal is accurate and helps prevent undervaluation issues that could impact financing or a sale. However, make sure to thoroughly read the report before asking for clarification. Often, the explanation is in the report.

Addressing appraisal discrepancies requires prompt action and solid evidence. Gather supporting documentation like recent comparable sales data, proof of property upgrades, and a list of unique features that may have been overlooked. Present your evidence to the appraiser respectfully and clearly. Highlight specific discrepancies and support them with documentation. Explain why certain comparable properties better reflect current market conditions if applicable. Well-organized, data-backed evidence strengthens your case and shows commitment to accurate valuation. Appraisers are more likely to reconsider and adjust their assessment if your argument aligns with professional standards.

Read the report and look for similar properties yourself. Ask other professionals if allowed. Entertain the use of ChatGPT to look for discrepancies. Make sure the report in compliance with guidelines.

Pour ajuster les évaluations lorsqu’il y a des comparables de transactions dont l’adresse est éloignée du bien évalué, je conseille de vérifier que les comparables sont situés dans des zones similaires en termes de service, de sécurité et date et d’attractivité. Il faut ensuite ajuster l’évaluation pour tenir compte des caractéristiques particulières du bien immobilier qui fait l’objet de l’expertise. Car chaque bien est spécifique avec un emplacement plus ou moins qualitatif et des aménagements plus ou moins adaptés et récents. Ces éléments ne figurent pas toujours dans les comparables. L’ajustement est donc toujours nécessaire et doit être réalisé avec beaucoup de sérieux.

If discrepancies are obvious and the values are too far apart, seek reappraisal. In my experience, 1 in 10 appraisal disputes may work in your favor. The current industry is held up to a high standard to ensure accurate values. Often, the appraisal report is reviewed by the appraisal management team, the lender, and the broker.