In last Friday’s article at “The Real Deal,” http://therealdeal.com/blog/2012/06/22/are-too-low-appraisals-preventing-some-markets-from-recovering/, they ask if appraisers are “scared” to value homes at higher prices in hot markets like Las Vegas.
My answer is “yes” in many cases. They are not reflecting the market conditions. In Las Vegas, most reasonable properties under $200k have multiple offers with many contract prices above the latest comparable sold homes. And in Las Vegas, a slight majority of purchases are all cash. Appraisers seem to be ignoring the cash closed sales or putting little weight on them. So using just the latest financed comps is causing closed-loop feedback where values are remaining study even though the market is speaking volumes that prices should be rising. We have some of the highest demand in history, lowest inventory, mulitple offers over list, and yet prices are just barely ticking up? I guess my economics professor was incorrect.