I recently got a HELOC (about three months ago) on a rental property and the appraiser undervalued the property by around $20,000 (significant since it was valued at 54K vs. the 75K that similar properties in similar conditions were selling for in the neighborhood). I think this occurred because I had recently bought it as a foreclosure and there were some other foreclosures in the area that had been bought. Needless to say all of these properties needed 20K+ in work to be comparable to the neighborhood average. I don't think it is a sound practice to compare a house in need of a significant amount of work to ones that are market ready. Also it would seem that there are two types of values a property could have: 1) The average retail amount 98% of homebuyers would pay for the property using conventional financing methods and 2) The amount an investor would pay for a property using all cash or equivalent means. Obviously this is not a new concept to anyone reading this, but apparently it was to the appraiser that appraised my property.

My question is how can I explain this to the appraiser to get a more accurate appraisal of the property? I'm going through the process again with my new personal residence (also a foreclosure) and am planning on pulling comps to provide to the appraiser. I think comps support a fair market value of around 100K-105K and I'd like to get around 75K out of it to combine with my other HELOC so I can start going after larger properties than the first few I've purchased. Would giving comps to the appraiser help or could it be seen as shady?? Any ideas?