April and May's increase in home sales have been the first back-to-back monthly home sales increase since September of 2005. Housing affordability is at historically high levels. So why haven't we seen a true housing recovery yet? According to Lawrence Yun, NAR Chief Economist, unemployment and new appraisal laws are to blame.
Distressed homes often sell for 20% less than traditional homes, however, some appraisals are not distinguishing between the two. Appraisers outside of the local area are being hired by lenders and may not take into consideration the unique qualities of a home. Moreover, changes in appraisal rules are leading to longer escrows. This can be seen in the continuous increase of pending home sales. These days, whether you are buying or selling, you may need to have more than one appraisal to back up your position. The quality of your appraisal is important. Real estate is local. Be sure to have your appraisal conducted by a local expert.
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