The current real estate market in Charlotte has a very low inventory for homes being sold. One result of low inventory is the increased likelihood of multiple offers being submitted for a single property. This results in bidding wars where the offers submitted by buyers far exceed the original listing price to ensure that their offer will be accepted over the other offers. However, what many buyers are not aware of is that their winning offer also exceeds the actual appraised value of the property.
When the property appraises for a lower amount than what was offered, who should bear the burden of the low appraisal? Whether it is the seller or the buyer, both should discuss this issue with their respective Realtors prior to making or accepting offers. Buyers need to understand how to avoid paying too much for a home, especially where there are multiple offers submitted for a single property. Sellers, who want to get the best value for their home in the current market, should also be aware of how to maximize their value in this transaction.
The best way to protect both your buyer clients and seller clients from issues that arise from a low appraisal compared to the purchase price is to contact an experienced real estate attorney that is familiar with how to handle these situations. An experienced real estate attorney is aware of the potential problems created by multiple offers and can draft the purchase contract with this in mind and help to avoid problems that could derail the entire transaction. The attorneys at Black, Slaughter & Black have years of real estate experience and have helped clients navigate these and other issues in the process of purchasing a home. We are glad to assist with any questions and to help make your home buying experience as smooth and simple as possible.