Saturday, February 11, 2017

The Appraiser Is Not Buying It

The moon setting over Merritt Island this morning just before sunrise in south Cocoa Beach.

I can examine the details of every single sale in Cocoa Beach every day for years, go in many of those sold properties and know things about many of the sales that aren't made public yet my opinion of property values in Cocoa Beach will never be held in the same high regard that an actual appraisal is. The one exception to this is the occasion when an appraisal comes in lower than expected. In those instances sellers are very willing to dismiss the appraisal as garbage. In most cases, in most minds, appraisals are seen as definitive proof of a property's present value.

I called a listing agent last week to alert him that I was sending over an offer on his new listing. I asked about the unusually high price when we talked and told him that I'd include comps with our offer to justify our offering price. He said not to bother, the owner had an appraisal done before listing and the asking price was at the appraisal number. He was as surprised as I was at the high number but the seller had firmly wrapped her arms around that number and expected to receive it. She didn't counter the very fair offer that I presented. A spendthrift purchaser may come along and pay the appraisal number but it's a long shot at best. Incidentally, the unit needs tens of thousands of dollars of renovations to approach average beach condo condition. Maybe she can get the appraiser to buy it since he and she are the only two people who believe his opinion of value. Or she can sit on it and let the rising market bridge the gap in a year or two.

Maybe my opinion of value is wrong and the appraisal is correct. They are both opinions and presumably based on the exact same data. The difference is that my opinion comes with a ready, willing and able buyer and the appraisal is accompanied only by an invoice for services rendered. The unit is still active this morning.

Public Service Announcement: Property owners and tenants, change your AC filters. Here on the beach, the inside air handler will last a decade or two longer than the five to eight year life of exterior compressor unit IF filters are regularly changed. The system will do it's job better and with less energy usage as well. The same condo unit I mentioned above had a filter change log taped to the air handler so that the date could be noted every time the filter was changed. That's a great idea in theory. The last entry on the log was dated 2014 with a note from the person changing the filter that she used the last filter and more were needed. There was no filter in the unit when I checked and no spares around. It looked like it might continue to blow air another day or two. Expected high in Cocoa Beach today, February 11, 2017, is 78 degrees under sunny skies. Enjoy.

“People would say to me, “Hey man, you look just like Paul McCartney”, and I’d say: “I wish I had his money!”” __Paul McCartney

1 comment:

  1. Placing your asking price based solely on an Appraisal is about as crazy as basing it on a Zillow Zestimate. I can see how frustrating that must be when going against that logic.
    Good advice too on the filter changes. As a landlord and house owner, I go nuts when a tenant leaves and the filters were not changed or left out.