We have had many borrowers recently tell us that they refuse to pay a certain amount for a property b/c “the house is not worth it” despite that fact that there are five other offers on the house at the same or higher price.
In a similar vein, one of our favorite Realtors told us yesterday about buyers saying they refuse to pay a certain price b/c the seller has “no right to make so much money.” These buyers simply think it is unfair that some sellers timed the market beautifully and are able to take advantage of massive appreciation in areas like Berkeley and North Oakland.
Our point to all these buyers is that the market is the market is the market. If multiple parties are willing to pay a certain price for a property, that is what the property “is worth” at the present moment, irrespective of what it will appraise for, or what is “fair.”
Sellers are not going to leave money on the table and accept a lower price to maintain “fairness in the universe” or to comply with comparable sales data from last summer.
Buyers have some leverage if and when appraisals come in low, but with so much cash in the market, appraisals are often irrelevant.
Founder/Broker | JVM Lending
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