I have a guy selling a house that keeps telling me that the house will appraise at $600,000 …and the asking price is $500,000 can i sign a contract on the house saying that i will purchase the home only if it appraises at $600,000…this would be the only reason for me to purchase the house would be for the $100,000 in equity…otherwise i wouldnt want the home.
You can make a contract ‘subject to’ just about any requirements…
Keith
You can write a purchase contract with whatever clauses you wish. But do you really believe the property is worth $600k if the owner is willing and able to sell it at $500k? Unless this is a distress sale or the $600k number is an after-improvement value the market value of the property is that value a willing seller and a willing buyer agree to.
Actually the market by me is like that…lots of homes are selling under the appraisal price…there are other homes like this available…the market price is 20 % under the appraisal…found another home with an appraisal for $540k with an asking of $479k…some florida homes are selling for like 30% under appraisal and people are taking out home equity loans at closing.
I guess that is my point, if homes are regularly selling at below appraised value then the appraisal is nothing more than a piece of paper. The actual selling price of the homes is the true market value so long as it is not a distress situation.
Getting a bank to loan on an inflated appraisal is not only unlikely but a good way to over leverage a property and get yourself into financial difficulty. Be cautious in a declining market.