We recently looked into selling our house because the market has increased slightly, and we were thinking we could make some money! However, the comps that were pulled decreased the value of our home because there was a foreclosure and a re-location in our area. Even though our house appraised for more, we can't list it for that amount. Well we can, but chances of it selling are slim. We will hang on to it for awhile longer, but has anyone had experience with foreclosure's in their area that have decreased the value of their homes?
I am somewhat involved in the real estate market here in my area of southern Georgia. By that I mean I own some rental properties and, I buy and flip houses as a side business with my brothers. But, to answer your question yes I have bought and sold a few of my personal houses and, I have encountered this same situation with the comps of the areas once or twice. That's just the name of the game I am afraid because we can't change what happened with the comps they use for the appraisals. Unfortunately, that is the way they work and, thay is the way of it. However, I would make sure the appraisal service is a reputable one with the proper credentials. A second opinion is a good thing just like with medical diagnosis.
I second what alex said, get a second opinion. In your case it might not change too much because comps really are a big part of this game. I live in the nicest house in my neighborhood and it isn't worth as much from the real estate perspective as it is when you look just at all the equity put into it. Equity means only as much as the houses surrounding it. It isn't fair in my opinion, but that's the way it is.
If you don't need money urgently, put your house on sale for the higher value first while holding on to it. You might get lucky. If your house doesn't get attention after awhile, you can try lowering it gradually until you reach the maximum price the buyers would find reasonable. On the issue of foreclosures, it would impact your price as banks are normally willing to sell for less and it would compete with your house in the market. If there was only one or two foreclosures, you might have to wait for those to be sold before yours will get bought. But you have the edge in the sense that banks don't really advertise their properties for sale much.
Thats the thing about Real Estate, your property is a key component - but not the complete reasoning behind a new owner choosing your property. The location itself has value. It seems that people can look past this. A nice property in a bad location has less value then it would in a nice location. Location, location, location.
