A key ingredient is blocks a wider Metro Detroit housing market comeback, prospective buyers and brokers tell the Free Press.
Many real estate agents and home sellers say the market’s comeback could be even stronger if it wasn’t for what they consider overly conservative appraisals that lag the prices buyers are now willing to pay. . . .
For some brokers, close to a quarter of their deals this summer have run into problems because the appraisal came in below the price that the seller and would-be buyer agreed upon, according to multiple agents interviewed by the Free Press. . . .
“That's tough to swallow," said Realtor Andy Hargreaves with Coldwell Banker Preferred in Plymouth.
As a result, owners have to lower prices or delay selling in hopes for a higher appraisal eventually, reporter JC Reindl writes.
"The appraisals are really just killing things right now,” said Jason Matt, a Realtor with Coldwell Banker Weir Manuel in Plymouth, who estimates that 30% of the 113 homes his team has sold in 2013 have encountered appraisal problems.
Because lending institutions generally don’t write mortgages above the appraised amount, an appraisal below the agreed-to selling price will scuttle a deal, unless the buyer can bring enough cash to cover the difference between the sale price and the appraisal.
Appraisers say increased demand brings high bids on homes that don't reflect actual values, according to Reindl.
Some appraisers acknowledge a good deal of caution in the lending industry following the foreclosure crisis. . . .
“Anybody who weathered the storm is still a little gun-shy, and I don’t blame them,” said Livonia appraiser Norman Thomas.
