Hi Everyone, I'm getting ready to have my Seattle, WA BRRRR appraised in a few days. (link to old thread here... https://www.biggerpockets.com/forums/223/topics/46...)
Its been rented since June and I'm now going for my final refi to get a more standard long term mortgage.
There are many similar comps in the area in regards to sqft / beds / baths / home type / etc, however none which are renovated. I'm concerned this will likely bring down my appraisal (especially because I'm at the lower end of the sqft spectrum, 950sqft / 3br / 1ba).
Does anyone have experience putting together an info sheet for the appraiser in order to bump them in price? I put together the below info sheet / pics, and at the bottom a list of 5 comps. My goal with stating (in the below sheet) that I expect to appraise at 350-360k is that it anchors the mindset of the appraiser, so that even if they go below it wont be too far off. Is this a good or bad idea? Love to hear your thoughts...
Here's the spec sheet I put together....
Currently renting for $2,200/mo with high demand
Gorgeously remodeled from top to bottom, inside to out. No detail or aspect of the home was overlooked. $80k rehab to bring this home into the modern age. This work allows 16974 to stand above similar comps.
Based on comps and market demand, we expect *Address hidden* to appraise at $350,000-360,000.
- - Roof
- - Fence
- - Deck
- - Exterior paint
- - Windows
- - Landscaping
- - Permitted brand new electrical service and additional circuits
- - Complete kitchen with quartz counters, SS appliances, subway tile
- - Complete bathroom with designer tile
- - New flooring and paint throughout
- - Solid wood doors and trim
- - New water heater
- - Lighting
|$330,000||Avg condition||3/1||1010||1178693||1732 Beacon Wy SERenton, WA 98058|
|$340,000||Avg condition, old||3/1||1150||1178693||3500 Shattuck Ave SRenton, WA 98055|
|$319,000||Avg condition, old||3/1||910||1190202||12016 SE 165th StRenton, WA 98058|
|$316,400||Avg condition, old||3/1||1000|
|12720 SE Petrovitsky RdRenton, WA 98058|
|$360,000||Avg condition / Newer||3/1||1210||1183733||16309 128th Place SERenton, WA 98058|
For more background; as you can see from the above comps; just going off of 3br/1ba/950sqft we could probably expect the appraisal to come in around 300-320k; but those are all older average condition homes. I'm really wanting to push the appraiser to see the value of the rehab by anchoring them at 350-360k.
fwiw I read this online... Anchoring is a well-documented cognitive bias that describes the human tendency to rely too heavily on the first piece of information offered (the "anchor") when making decisions.
The 'anchor' ended up working very well. Appraisal just came back at $347k.
I was personally expecting to land in the 330k range; but I wanted the appraisal to come back as high as possible, so (per the above comment) I anchored the appraiser at 350-360k. In the appraisal report the appraiser used most of the comps I gathered, and had several notes which were copy/pastes of the text I had written him describing what had been done and how much had been spent on the property, so I know the appraiser took consideration of what I wrote.
End result; if you want a high appraisal it can help to put together an info sheet for the appraiser. It makes their job easier, lets them know what valuation you're targeting, and supplies them with supporting evidence.
Info sheets are a much. I've done this on 2 refis in the past 5 years and it worked like a charm on both. You are basically doing the appraisers work for them, then paying them $500 for their time.
Very cool. What do you do with the info sheet? Do you forward it to the appraiser in advance (and when), or do you just leave it in a conspicuous place in the property?
@Christian Wathne this is really awesome. I've talked to the appraiser in the past, and it's worked pretty well - but I can see how this would be an excellent resource for them (while prodding them in the right direction)
Thanks for sharing and glad to hear it worked out well!
Thanks @Mike McCarthy
@Ian Fretheim , when speaking with the appraiser to schedule time to view the property I told him I have an info sheet showing what work we've done that I want to send him, and asked for his email address. Then sent this info along with comps/etc about 3 days prior to when he would be at the property.
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