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Birmingham, AL real estate appraiser Tom Horn discusses 5 red flags during a home appraisal that agents should try to avoid.
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Suggested by Tom Horn-Real Estate Appraiser |
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Putting a value on a home is a skill and an art. There are some real estate agents that are good at it and other frankly who suck! Why do you think there are so many price reductions on a daily basis? It means one thing - the home was not priced properly from day one.
The best real estate agents do not have many price reductions. From a sellers stand point one of the reasons you hire an agent it to accurately price a home. This is a major function of a real estate agent.
In his latest article Tom Horn explains some of the problems that occur from his side of the ledger trying to appraise a property in which the comps do not justify the price put together by either the real estate agent or the seller. When I say the seller this is another way of saying the agent was a "yes man or woman" and just went along with the sellers price. Oftentimes a very big mistake!
Tom shows in his article 5 of the top things that cause an immediate red flag when he is appraising a home. Some of these include:
1.) A large jump in sales price in a short period of time.
2.) The contract price is way above sale prices in the neighborhood.
3.) The subject home is way overbuilt for the neighborhood.
4.) The comps provided are outside of the neighborhood when there are good comps to use in the neighborhood. Talk about the blind thinking they are leading the blind!
5.) Agent is using incorrect gross living area amounts.
Folks good real estate agents do not make these kind of mistakes. The problem is for every good real estate agent there are four lousy ones. The barriers of entry are far too low and cause anyone with a pulse to get into the industry.
Real Estate agents should be better trained when it comes to pricing homes correctly!