How much is your property worth?

The smart-ass answer is, it’s worth exactly what someone’s willing to pay for it.

The long answer is, it’s worth what you want to pay for it, or it’s worth what the seller thinks it’s worth, or it’s worth what the bank thinks it’s worth.

Yeah, about that.

So, say you decide to make an offer on a property. You’ve looked at all the comparable properties that have sold recently, you figure out how much you think it’s worth, you make an offer. You make an offer, the seller agrees, you think you’re set.

Not so fast.

Then the bank gets involved.

It sends out an appraiser to make sure the property is worth what you and the seller thinks it’s worth.

During the housing boom, often the bank thought a property was worth less than what the buyer and the seller thought (turns out, they were right, ha-ha!).

So, buyers had to either kick in the difference between the bank’s appraisal and the offer price, walk away, or try to get the seller to lower his/her price.

Or, try to convince the bank’s appraiser to up the appraisal.

Which, of course, led to lots of conflict of interest (hey, appraiser, if you want more of my business, you’d better make this property appraise out …).

Anyway, that’s all in the past.

Nowadays, surprisingly, it’s become easier and easier to get a property to “appraise-out”.

According to Kenneth R Harney, in the Washington Post:

In some parts of the country, mortgage lenders — and appraisers themselves — say they’re increasingly coming in with valuations higher than the contract prices agreed to by sellers and buyers.

“We’re seeing it a lot now,” said Patrice Yamato, president of Plaza Mortgage Group in Jacksonville, Fla. “Appraisals are coming in higher than the contract” — a reversal of the pattern during the housing boom, when appraisals often came in at or occasionally below the contract price.

“I think buyers are pushing very, very hard,” Yamato said — and they’re walking away with steals.

I encountered a very similar situation, last week. A client of mine was looking at a condo listed at $390,000 (hi Alan!). Due to my client’s persistence (and my crack negotiating skill) we were able to get the seller to accept his offer of $360,000.

So, then the lender sent out the appraiser.

And he ended up appraising it at $370,000.

Instant equity, eh?

Of course, I guess you could still make the argument that the appraisers are “fluffing” the numbers, but that’s not true, probably. I mean, what buyer would be willing to “overpay” for a property, these days?

(Also, makes you wonder, what if he had been willing to pay full-price of $390,000? Would the appraisal have magically become $390,000 or $400,000? We’ll never know.)

Source: High Appraisals Signal Change – By Kenneth R Harney, The Washington Post

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Updated:  1st Q 2018

Author Profile

John Ford
John Ford

Over the course of 20 years in the Boston downtown real estate market, John represented and sold numerous, condominiums, investment and development properties in Greater Boston and in the surrounding suburbs

In addition to representing Boston condo buyers and sellers, John is currently one of the most recognized Boston condo blog writers regarding Boston condominiums and residential real estate markets. John's insights and observations about the Boston condo market have been seen in a wide variety of the most established local & national media outlets including; Banker and Tradesman, Boston Magazine The Boston Globe, The Boston Herald and NewsWeek and Fortune magazine, among others.


For over 24 years, John Ford, of Ford Realty Inc., has been actively involved in the real estate industry. He started his career in commercial real estate with a national firm Spaulding & Slye and quickly realized that he had a passion for residential properties. In 1999, John entered the residential real estate market, and in 2000 John Started his own firm Ford Realty Inc. As a broker, his clients have come to love his fun, vivacious, and friendly attitude. He prides himself on bringing honesty and integrity to the entire home buying and selling process. In addition to helping buyers and sellers, he also works with rental clients. Whether you’re looking to purchase a new Boston condo or rent an apartment, you’ll quickly learn why John has a 97% closing rate.


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John Ford and his staff can be reached at 617-595-3712 or 617-720-5454. Please feel free to stop by John's Boston Beacon Hill office located at 137 Charles Street.

John Ford
Ford Realty Inc
137 Charles Street
Boston, Ma 02114



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