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Spring Cleaning time!

February 22, 2016 by 4 Comments

Spring Cleaning Just Ahead Green Road Sign with Dramatic Clouds, Sun Rays and Sky.

It was almost 60 degrees this past weekend and really started feeling like Spring. I know I just probably jinxed us into another blizzard or two in March and April. Regardless, the weather got me in the mood to do some clean-out in our garage.

While moving some things around and tossing others, it got me thinking that now is the time for agents to start doing “Spring Cleaning” with their current inventory. We all know Spring is when the Buyers come out of hibernation and savvy Sellers want to list. Now is the time to revisit those listings that maybe haven’t moved as quickly as once hoped. Perhaps, the sellers have been “stuck” on a price or maybe the original list price was just too aggressive. What ever the case, if your listing has been on the market for longer than the average days on market for your area, it’s time to rethink your pricing.

TCG DOM Chart

There are thousands of shiny, new listings on the horizon. These listings are going to compete directly with your older listings. Many of the buyers currently in the market are anxiously waiting to see these new listings, even holding off pulling the trigger until they arrive.  Some of them are the same buyers that may have already seen and passed on your listing. The only way to get their attention again is to make a calculated change to your pricing and marketing strategy.

When looking to make a pricing change consider these points…

• Be honest…with yourself and your client. If the pricing of the house was off from the beginning, admit it and start fixing the problem.
• Be realistic…sometimes real change hurts. Adjusting the price by a couple hundred dollars just to have the listing show up on the hotsheet probably isn’t going to do it. Real change will involve careful thought and meaningful action.
• Be in the market, not just on the market. If your listing is priced higher than the immediate competition, it will be passed over. Look at it this way, why would an informed buyer purchase your listing when they can get a very similar home down the street for less? The answer is “they won’t.”
• Be willing to seek help. We all like to be the real estate expert. We all like to think we have our finger on the pulse of the market and our pricing is spot on. Well, this goes back to point one. Be honest with yourself…sometimes we need help or a fresh set of eyes to look at the situation. Be willing to get help from another agent, your broker or a real estate appraiser.
• Be willing to walk away. Sometimes cutting ties is best for all involved. Maybe your Seller is unwilling to budge on the price or “has to get” a certain number. This is where you have to make a sound business decision. Are you able to help your client to the best of your ability in a situation like this? If not, it’s probably time to step away and direct your talent, effort and energy elsewhere.

The 2016 Spring Selling Season is poised to be pretty significant. Low inventory, low rates and pent up buyer anticipation are going to add up to a hot market. Hopefully, you and your clients can take full advantage of it with adjustments to the pricing of your older inventory.

If we can be of assistance to anyone considering making some changes please feel free to contact our office. We are always helping agents and their clients with Pre-listing and Market Value Appraisals as well as Home Measuring Services.

The Coyle Group’s team of Philadelphia 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
* Data obtained from TReND MLS. Average Days on Market measured from February 1, 2015 thru February 22, 2016.

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Geographic WHAT?!?!

June 10, 2014 by 3 Comments

The Coyle Group - Geographic Competency - Philadelphia AppraisersYou may have heard the term Geographic Competency as it relates to appraisers. It’s been a hot topic in the appraisal industry for the past few years. It basically means that an appraiser has to be knowledgeable and capable enough to produce accurate and reliable appraisals within a specific geographic area. The appraiser should also have access to data about a geographic area. It’s the coupling of local knowledge and accurate data that can make the difference between a reliable report and one that’s not worth the paper it’s printed on.

As the appraisal market began to change over recent years, many appraisers found themselves expanding their coverage areas in an effort to stay busy. For some appraisers this meant working in areas with which they were not familiar. This often resulted in reports that were poorly supported and wildly off the mark.

If an appraiser finds themselves in a situation where they do not feel Geographically Competent, they have a few options. All are designed to protect the user of the report from getting inaccurate information from the appraiser.

1) They can decline the assignment

2) They can obtain the knowledge necessary to become competent to appraise in a certain area

3) They can seek assistance from another person who is Geographically Competent in that area

Over my 15 years of appraising in the Philadelphia market, agents have shared stories about appraisers coming from miles away to complete appraisals. My favorite is a tale of an appraiser from Parsippany, NJ who drove two hours (both ways) to complete an appraisal in Philadelphia. That’s insane! Not to mention that after time and travel the appraiser was literally working for peanuts!

But keep in mind that an appraiser doesn’t have to live close to a property in order to be competent to appraise there. Most appraisers are capable of appraising in several different counties or even states. I have an appraiser friend who lives in Lower Bucks County and routinely appraises homes at the New Jersey shore. It turns out that he has a house down there and actually worked in that market for several years. He’s competent to appraise there even though he lives in PA.

If you find yourself in a situation where you are not sure if the appraiser has experience appraising in your area, talk with them about it. Interview the appraiser. Ask about their experience in your area. The answers you receive could save you from a “bad” appraisal.

Do you have any stories about appraisers traveling far and wide to look at properties? If so, please share them.

 

The Coyle Group’s team of Philadelphia appraisers is a leading provider of appraisals for Estate/Probate, Divorce, Bankruptcy, Tax Appeal and Pre-Listing appraisals.  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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Fighting a “Low Appraisal”

September 28, 2012 by Leave a Comment

A friend of mine, who is an agent, called me the other day complaining about an appraisal that was completed on one of her listings. The appraiser (from a neighboring county) arrived at a value almost $45,000 under the contract price. She asked me if I could take a look at the appraisal and provide any insights that I might have.

It’s not unusual for values to come in lower than the contract price; and we all know that value and price are two separate things. However, there was such a large discrepancy, it warranted a closer look. After reviewing the appraisal, I did notice some issues that were of concern.

I recommended that the she ask for a Reconsideration of Value. A Reconsideration of Value is a formal request submitted to the lender asking their appraiser to consider additional information and/or sales data that might aid the appraiser and cause them to change their opinion of value.

Here are the steps that I suggested she take:

  • Go through proper channels.  The appraisal is the property of the Lender who ordered the appraisal.  You will have to submit your request for Reconsideration of Value to the Lender, usually in writing.  The Lender will then decide whether or not the request has merit.  If so, they will forward the request to the appraiser for review and response.  Do not contact the appraiser directly.  Remember that the appraiser’s client is the Lender; not the agent, the Seller or the Buyer.  The appraiser can’t act on your request or revise his report without permission from his client, the Lender.  Please note that the Lender can use their discretion and may deny your request without even presenting it to the appraiser.
  • Practice the 3 “Ps”.   Be Proactive – initiate the request promptly.  Be Professional – don’t get bogged down in personally attacking the appraiser or his skills, present your case in a professional, well-supported manner.  Be Polite – appraisers are people, too.  Really, we are.  You will get further with your request if you simple practice good manners and politeness.
  • Support your request with good sales information and insights.  Simply saying that “the value is not high enough” will not cut it.  Be prepared to provide additional comparables and explain why they are more appropriate that those used in the report.  If you have comments about the comparables used in the report, be specific and detail exactly why the comparable used in the report was not the best one available.  If you work frequently in a certain market and have intimate knowledge of sales in the area, use that information to support your point.  “Comp 3 was a nasty divorce situation and they needed to sell quickly.” Or “Comp 2 is actually 500sf larger due to a finished attic that is not noted in the public records.” Good, well-supported information will go a long way.  And, if you are going to provide additional sales, make sure that they are truly comparable.  Don’t just look for sales that will support your price. The appraiser and the Lender will see right through that. If your property is 3 bedroom Rancher, don’t include the 5 bedroom Colonial as a comp, even if it is located across the street. They’re just not comparable.
  • Be Specific. If you want to know why the appraiser made or did not make a certain adjustment or did or didn’t use a certain comparable, address it directly and specifically in your request. “Can the appraiser explain why he only made a $5,000 adjustment for the subject’s inground pool?” Or “Why did the appraiser elect not to use the sale at XXX Main Street, one block away?”
  • Keep it Short & Sweet. Don’t write a novel. Don’t get emotional. Get to your point, present your case coherently and concisely, provide supportive information and then, move on.

I hope these steps will help you if you ever find yourself in this kind of situation. Should you ever need any assistance with contesting an appraisal or submitting a Reconsideration of Value, please feel free to contact our office. We will gladly do what we can to advise you.

The Coyle Group, LLC is a Residential & Commercial Real Estate Appraisal firm serving the Greater Philadelphia Region and New Jersey.  215.836.5500

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Another Reason to get a Pre-Listing Appraisal

April 11, 2011 by 1 Comment

Just the other day, I received a phone call from a Mortgage Broker friend of mine. Yes, appraisers and Mortgage Brokers are still allowed to be friends.

He wanted my input on a situation in which one of his former clients found themselves.  Let’s call them the Utley’s. (For the privacy of the parties involved, I will not use the actual names, streets, pricing or house photo in this post.)  The Utley’s currently have their home listed for sale in Springfield Township, Montgomery County for $345,900.  There home has been on the market for 39 days and they have an offer on the table for $339,000.  The Utley’s are concerned about whether or not they should accept an offer this “low”.

I began buy pulling up the information on the Utley’s home in the MLS and public records.  It is a nice 1939 colonial with three bedrooms, 1.5 baths, approximately 1,500 Sq.Ft.  A very common home in this area.

Then, I took a look at the sales and listing activity in the immediate area for similar homes.  What I found was surprising.  The last three sales in the neighborhood in the past year sold for $370,000, $370, 000 and $412,000.  There are currently two competing listings in the neighborhood listed for $370,000 and $469,900.  The home listed at $469,900 was a larger, four bedroom that was completely renovated, probably not the best comparable.

However, there was also one pending sale right around the corner from the Utley’s.  This house was last listed for $339,900 but, it lacked a powder room and was roughly 220 Sq.Ft. smaller.  It had also been on the market for over 160 days with an original list price of $364,000.

After looking at this information, my question to my Mortgage Broker friend was “why did they list it so low?”

By listing at $345,900, the Utley’s are basically telling the market “Hey, this is my pie-in-the-sky, hope I can get it number…but, I am probably willing to take less!”  The reason they are receiving “low” offers is because they apparently under listed their home, based on available market data.  They (and their agent) may have shot themselves in the foot.

To compound the issue, it turns out, the Utley’s agent is a “friend of the family” (probably not for much longer after this experience) that is a licensed agent but, who is not very familiar with their neighborhood.   In the end, the Utley’s may be leaving thousands of dollars on the table or may have to re-list at a higher price.

This is a perfect example of why Sellers and Agents need to have a Pre-Listing Appraisal completed prior to listing a property.  A Pre-Listing appraisal can assist Sellers and their Agents maximize their selling price without over or under pricing.  If the Utley’s and their Agent had an appraisal of the home done prior to listing they might have developed a different price point and might not be in a situation where they are entertaining such “low” offers.

For information on The Coyle Group’s Pre-Listing Appraisal services, please call our office at 215.836.5500 or visit this link.

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Manayunk, Philadelphia

January 3, 2011 by Leave a Comment

The Coyle Group - Manayunk, Philly

We’ve received a number of calls from real estate agents in the Philadelphia market, including Montgomery, Bucks, Delaware and Chester Counties who have been inquiring about our Listing Appraisal Service.  Many have asked to see some case studies.  We thought it was a great idea and will be posting Listing Appraisal case studies from time to time.

Our first Listing Appraisal Case Study involves a house located in the popular Manayunk section of northwest Philadelphia.

The agent called The Coyle Group to help revise the list price for the house.  It had been on the market for over 150 days and the showings had pretty much stopped.  The agent was hoping that an objective appraisal might help convince the Seller to lower the price to be more competitive and hopefully get the house sold.

One of our certified appraisers inspected the house, researched the market and prepared a report for the agent and Seller.  The appraisal results indicted that the house was priced about 7% higher than comparables homes in the area.  It wasn’t competing.The Seller lowered the price and the showings picked up, again.  The house was under contract within 10 days of the price change.  The contract price was within $2,000 of our appraised value.

To find out how TCG can help you with your listings visit our Listing Appraisals page

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