Why did my appraisal come back $30k lower than the listing price?

General
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Why did my appraisal come back $30k lower than the listing price? We offered the list price of $389k just two days after it was listed, but the appraisal came back at $360k. We’ve asked the sellers to meet us at the appraisal price, with the condition of a current sale. How likely is it for this to work out? Should we start looking at other houses?

We really like this one, but we’re not willing to pay $30k above the appraisal value. Could offering so soon after listing affect our chances, especially with potential cash buyers? This is in Chicago, and we’re planning to move further west for single-family homes. We’ve already listed one of our condos in the city and received three cash offers right away.

If someone offered cash for the house we’re buying, they might not care about the bank or appraisal, right? Do condos in major cities tend to get more cash offers compared to single-family homes further out? What do you think our chances are here?

Just to add, we can afford this property if we decide to go ahead with it. We could almost pay for it outright if we liquidated some of our other assets. Our pre-approval is double the $350k appraisal. That’s why this decision is so tough. Should we go against the appraisal value or not?

2 Likes
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I experienced the same situation. I ordered a second appraisal and switched financing companies. The new appraisal came in just $1,000 below the asking price, which saved the deal.

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If you truly want the home, go ahead and pay for it. If you’re unsure, keep looking. That extra $30,000 might be worth it if this is the home of your dreams.

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I understand your situation well. When I bought my last house, the appraisal also came in lower than the listing price. It’s frustrating, but appraisals are based on market data and comparable sales. Asking the sellers to meet at the appraisal price is reasonable, especially if you can show them the appraisal report. However, if they’re not willing to budge, it might be wise to start exploring other options. Cash offers can indeed be attractive to sellers, but don’t feel pressured to go above the appraisal value if it doesn’t align with your financial strategy. Trust your instincts and make the decision that feels right for your situation.