First American Title issues a quarterly report, the Real Estate Sentiment Index (RESI), which “measures title agent sentiment on a variety of key market metrics and industry issues”. Their 2015 4th Quarter Edition revealed some interesting information regarding possible challenges with appraisal values as we head into 2016.
The fourth quarter RESI found that title agents continue to believe that property valuation issues will be the most likely cause of title order cancellation over the coming year.
This shouldn’t come as a surprise. In a housing market where supply is very low and demand is very high, home values increase rapidly. One major challenge in such a market is the bank appraisal. If prices are jumping, it is difficult for appraisers to find adequate, comparable sales (similar houses in the neighborhood that closed recently) to defend the price when performing the appraisal for the bank.
Another monthly report by Quicken Loans measures the disparity between what a homeowner believes their house is worth as compared to an appraisers evaluation. Here is a chart showing that difference for each month through 2015.
Bottom Line For Central OH Home Sellers
Every house on the Columbus real estate market has to be sold twice; once to a prospective buyer and then to the bank (through the bank’s appraisal). With escalating prices in Central OH, the second sale might be even more difficult than the first. That is why you need an experienced real estate professional to help set your listing price.
Contact me, Rita Boswell at 614-547-3229 today to learn the current market value of your home for free. Proper pricing of your home can be the deciding factor in a successful home sale.