When Do You Need A Listing Appraisal?

This question was asked of me the other day…it’s one that I hear a lot.

When should I get a Listing Appraisal and do I have to share it the Listing Appraisal with potential  buyers?

Great question!  Let me break it down into two parts.

When should you get a Listing Appraisal?  There is really no “written in stone” time to get a Listing Appraisal.  However, here are a few suggestions as to when you may want to think about it:

  • When you are trying to get a new listing
  • When you are trying to retain a current listing
  • When your sellers are reluctant to adjust the price to the market
  • When your listing’s Days on Market (DOM) are higher than the average DOM for your market
  • If your listing contains the phrases “new price” or “price reduced” in the description
  • If markets are shifting either upwards or downwards (think Spring and Fall)
  • If the property is unique or an “oddball”

Benefits of a Listing Appraisal

  • Allows the agent (the marketing expert) to bring in an appraiser for a fresh set of unbiased eyes.
  • In other cases, the appraisal allows the agent to retain the relationship with their client while, the appraiser delivers the “bad news” that their home may be incorrectly priced.

Not all situations warrant an appraisal.  It’s a case-by-case kind of thing.  But I do know a couple of local agents who get appraisals as part of everyone of their listing appointments.  They tell me it puts the client at ease knowing that the agent is more focused on helping them price the property correctly than getting the listing.

Now the second part…Do I have to share the appraisal with potential buyers?  The answer to that is “no”.  You/your client own the appraisal.  It was completed for the sole purpose of helping you price the property (using it for anything like tax appeal, lending, divorce, estate, bankruptcy, etc would render it null and void).  There is no requirement that private appraisals be recorded or archived.  You are not required to disclose whether or not you had an appraisal to a potential buyer.

Hope that answers the question.

The Coyle Group’s team of Philadelphia Real Estate Appraisers are a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing. If you need a guest speaker at your next sales meeting, please give us a call. We would welcome to opportunity to speak to your group and field any appraisal related questions you may have. For more information please visit our website at www.TheCoyleGroupLLC.com You can also contact The Coyle Group at 215-836-5500 or appraisals@coyleappraisals.com

 

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Comments

  1. Great post Michael. I want to add one thing. You said, “When your listing’s Days on Market (DOM) are higher than the average DOM for your market” I would also add when your DOM are lower than average. So many real estate agents advertise in their marketing that they sell homes faster than the market average. My response is that if they are routinely selling homes faster than market, then they are probably selling too low.

  2. Another great benefit of the pre-listing appraisal is that you will have accurate square footage to pass along to potential buyers. This is a problem in my area because a lot of agents use tax information.

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