Credit, Appraisals Hurting Home Sales, NAR Says
Washington, DC, Oct. 12, 2012 -- The real estate market is recovering but still faces hurdles, notably from tight mortgage credit, according to the National Association of Realtors.
In addition what NAR says are faulty real estate appraisals are also holding back home sales.
NAR says appraisals generally lag market conditions and some changes to the appraisal process have been causing problems in recent years, including the use of out-of-area valuators without local expertise or full access to local data, inappropriate comparisons, and excessive lender demands.
In addition, before the beginning of last year, some lenders’ loan processors edited valuations, cutting them by a certain%age, NAR said.
Although 65% of Realtors surveyed in September report no contract problems relating to home appraisals over the past three months, 11% said a contract was cancelled because an appraised value came in below the negotiated price, 9% reported a contract was delayed, and 15% said a contract was renegotiated to a lower sales price.