Echoes of 2005 in the Phoenix Real Estate Market

328885_289448647732649_1438363659_oNothing says sellers’ market arrogance like this, seen on a pair of listings this morning:

Inasumch as appraisals often lag actual market value, seller requires any non-cash offer to pay the difference between the sales price and the appraised value.

Sounds much like the common note on listings during the 2005 bubble, that the seller requires to buyer to waive the appraisal contingency on all offers.

Having said that, here are a couple of other thoughts:

1) As a seller, you can’t require the buyer to pay the difference unless your agent writes that into the contract. At which point, if I had the buyers, I’d recommend they tell the sellers to perform an anatomical impossibility upon themselves. No one – NO ONE – should agree to covering the difference without the slightest idea what that amount might be. May as well hand the seller a blank check.

2) Nothing says a listing’s overpriced like the above language. The reality is appraisals aren’t lagging all that far behind – twice in the past six weeks I’ve seen appraisals come through on a listing of mine where I thought it was all but impossible. One was FHA. If the comps are there, the appraisal still can come through.

3) Using fancy wording like “inasmuch” doesn’t make you any less of a money-grubbing jerk.

As a listing agent, I’m all in favor of pushing the envelope on listing price when the market dictates such a strategy. But to throw a dart at a price charge, call it good and tell the buyer its his or her problem if the list price and market price have no correlation … that’s just bush league, no better than listing a home at an irrationally high price in the first place.

By the way … if you’re not up for silly reindeer games when selling your house, drop by ExpiredtoSoldAZ.com or give me a call and I’ll get it sold – quickly, ethically and without the circus sideshow.

About Jonathan

Jonathan Dalton is a 30-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at allphoenixrealestate.com.

  • What? They’re negotiating without an offer. So?

  • It’s more a sign of what easily can follow … buyers desperate enough to do such a thing, to waive appraisal contingencies … it’s a short leap to a bad end.