Posted by Rob FL on February 12, 2002 at 11:40:08:
Things may be slightly different in Detroit. But here is the way it works where I am at. The property gets listed at appraised value. After a period of time (normally 45 days) if it doesn’t sell, the price is reduced. If it doesn’t sell at the reduced price after a time, it is reduced again. This process continues until someone finally closes on it.
As for the value determined by the appraisal, normally the price on the appraisal is it’s After Repaired Value minus the cost of repairs. This value does not include the cost of an investor to purchase, hold, and resell the property nor should it. That’s not how the appraisal guidelines work.
Hey all!
Recently, I saw a juicy opportunity on a local HUD site. It listed a house that appraised for about $70,000, but was reduced to an asking price of $45 K !!! Unfortunately, it was snapped up before I could move my newbie butt in gear.
Here’s the Q: Why would HUD cut the price on this property so drastically, when it usually asks for the house’s appraised value?
I was thinking that it might be due to real slow sales in that low-to-moderate income area, but the asking prices in other similar areas were unphased. It also might have been a real crapper, but wouldn’t that reflect in the appraisal?
Any ideas, folks?