Real Estate

I work for a mortgage company in the appraisal department. I was reviewing an appraisal and the appraiser used pending sales and active listings to support the value of the home. This is fine by me, but there was not an adjustment for negotiation (as most of us know, homes often sell for an average of 3-5% less).

Well I got into a dispute with one of the "branch leaders" in another state who claims that pending sale homes have the full contract price disclosed and that is why the appraiser did not adjust. I always thought that it was illegal to prevent a 3rd party from seeing what the price was and going to the seller to offer a bit more… am I wrong here?

I for some reason only have access to yahoo at work so I can’t research on real estate websites… if anyone could help me get this jerk off my back, I’d appreciate it. Even if I’m wrong- I’d just like to know!

Thanks!

I don’t think you are wrong. I haven’t practiced real estate for a few years but I’m almost positive a Realtor is not supposed to disclose a pending purchase price. The deal could fall through and then the seller might not get a better offer because others would know how much he had agreed to before. The only way I can think of that the appraiser found out the contract price would be if he/she called the listing agent and asked. The agent shouldn’t have told but sometimes people don’t realize what they are or are not supposed to tell, especially since an appraiser is somewhat of a colleague. I do remember that houses under contract only show up in the MLS as under contract and the actual selling price doesn’t show up until the deal is closed and the listing is changed to sold. I think you are right and the branch leader doesn’t know what he/she’s talking about.

3 Responses

1. angela Says:
   November 30th, 2009 at 5:19 pm

   I don’t think you are wrong. I haven’t practiced real estate for a few years but I’m almost positive a Realtor is not supposed to disclose a pending purchase price. The deal could fall through and then the seller might not get a better offer because others would know how much he had agreed to before. The only way I can think of that the appraiser found out the contract price would be if he/she called the listing agent and asked. The agent shouldn’t have told but sometimes people don’t realize what they are or are not supposed to tell, especially since an appraiser is somewhat of a colleague. I do remember that houses under contract only show up in the MLS as under contract and the actual selling price doesn’t show up until the deal is closed and the listing is changed to sold. I think you are right and the branch leader doesn’t know what he/she’s talking about.
   References :
   Former Realtor

2. Gary Says:
   November 30th, 2009 at 5:46 pm

   When I was an agent and used to price homes, I would use under contract listings for my price analysis, but I would use the LIST PRICE as the price for those listings. That may alter the true actual value slightly, if the under contract listings were actually being sold for less than list price, but in the "Big Picture" of my analysis, probably not enough to hurt. I can’t think of ANY legal circumstances where the under contract price should be disclosed to anyone. Most appraisers I have known used the same method. I cant speak for all agaents, but even though appraisers are sort of "Colleagues" of ours, I still didn’t give them the contract price of an active contract….WAAAAAY unethical……
   References :
   5 yr realtor

3. hanora Says:
   November 30th, 2009 at 6:27 pm

   You would be wrong in Ontario, but law and practice differ.
   References :

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