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11-26-2012 10:54 PM
I am a first time buyer and i have recently put an offer an a house in Pasadena. The selling agent gave us a counter offer and asked us to waive the appraisal contingency. This house was flipped and though it is selling for 180K more than it was sold, they did add a full bed and bathroom. Anyway, I'm guessing that the agent knows that the value is not going to be as high as the offers (by the way there were 6 other offers with three being competitive). What I am wondering is if this house is just overpriced and not worth it or should I counter with a lower and waive the appraisal contingency.
This is the link for the house.
11-26-2012 11:46 PM
The house is listed way above comps for the area. Look at the bottom of the listing to get to comps. Then decide on your offer.
If it was a reasonable price they would not ask you to waive the appraisal contingency.
11-26-2012 11:54 PM - edited 11-27-2012 12:00 AM
Sounds like a setup. Like the previous poster said, if it weren't a issue, they wouldn't ask you to waive it. What if the appraisal comes in lower? I assume your getting a loan. If so, are you going to have to cover the difference? Are you ok with that, or even able to? If not, you could lose your deposit. If your paying cash, it really doesn't matter so much. Especially if that's the house you really want and your ok with the price regardless of appraisal.
I would also check for permit issues on that particular property. It appears to be a flip and the county records show only 2 beds/ 1 bath & 1,042 sq. ft. Was ALL the work done with permits? If not, that house would be wildly overpriced.
11-27-2012 06:37 AM
As a side note, please be aware that this house has a Pasadena address but is actually in unincorporated Los Angeles County. That may not matter to you, so just a heads-up.
11-27-2012 09:03 AM
Just move on and avoid this listing if agent insists on waiving appraisal contingency. This is a major setup like someone mentioned above..
11-27-2012 09:30 AM
Thank you so much for your comments. You guys helped me think clearly about this which helped me not get overwhelmed by excitment haha.
11-27-2012 09:31 PM
Well, this is certainly indicative of our current escalating market. I have noticed my business increase 5 fold in the past 4 months. Every offer I write has been in a multiple offer situation. It is very competitive out there, making it very difficult for a person to become a home owner. So, I understand. If this home has that many offers; 3 being competitive, then it is probably not overpriced. That being said, the appraisers are currently the "Gods" in the Real Estate World right now. Because they are required to appraise based on historical data only; the true market value is being surpressed. Were it not necessary to get an appraisal to close on most homes....prices would be a lot higher. Appraisers are holding the market prices down. So, if you have the ability to purchase the home without needing the appraisal for qualifying for a loan; you are indeed in a good position. However, I would caution you, as I do all my buyers, to take a deep breath and think hard before you do this. It may be hard to get a desirable home in this current market without waiving the appraisal contingency, or paying cash. Good luck.
11-30-2012 08:34 AM
It means you don't stop on the freeway to help a persona holding a gun.
Let others bite hook and sink. When there's no room for negotiations, you are going to be sored later. It seems this property has some illegal additions or something like that. It could be good for you in the long run, but the day you need to sell for any circumstances, this addition will comeback to bite you in the ..................back.