Ridiculously Low Appraisals Are Killing My Clients!

I think the Real Estate Appraisal Industry in Calgary, Rocky View, and Foothills is a load of crap. I will refrain from mentioning names here but I will cetainly let you know how I feel.

I have been selling properties for 10 years now and I know values. For the second time in just the last 30 days, I have SOLD my listings only to have the appraisals come in so low that the deals fall apart. Now it is my understanding that the appraisers are under serious pressure to be putting low numbers, but they need to understand the impact of their ridiculously low appraisals. I am talking about $100,000 to $150,000 lower than the actual conditional selling prices.

How is it that the market will yield what I sell the property for, and then the appraisal tells me it is worth $150,000 less than what somebody is willing to pay? Do these appraisal companies understand that they are in fact reducing the values of  all of the properties in the area? Do they understand that there are people out there selling properties for the third time as they keep crashing all of the deals that us REALTORS are putting together on their homes? Do they understand that I am getting calls from neighbours so excited about the fact that we actually conditionally sold properties for decent numbers in their area within 30 days of list price, and I eventually need to tell them that “the appraisal crashed the deal”?

I have one particular client carrying 2 acreage properties, to the tune of $8000 per month, and I had one of his properties SOLD long ago and this poor family having to pay these ridiculous interest payments now all because of a brutally low appraisal.

As you can see I am gettng to the end of my rope with this problem and something needs to be done. I should not have to do my job 3 times in order to get a deal closed for my seller clients. Not to mention the fact that I am not getting compensated on these deals. My business is not capable of me having to do my job over and over to close one transaction. This is absolutely ridiculous.

Comments of all kinds would be greatly appreciated. Whether or not you agree I will appreciate all perspectives.

Tom.