Condemnation appraisals differ in many ways from typical market value assignments. In condemnation appraisals, appraisers often cannot consider the best comparable sales and comparable sales impacted by condemnation. In addition, to the condemnation appraisal, the values of the “part taken” and “damages to the remainder” must both be calculated. Further, since a condemnation appraisal may be scrutinized during a judicial proceeding a higher standard of care is required in researching and preparing the appraisal. Property owners should proceed with caution when approached by condemning authorities. Some condemning authorities are straight forward and make their initial offer their best offer. Other condemning authorities start off with a below-market offer and slowly escalate offers at each step in the process. Property owners should consult with an appraiser or property owner familiar with the condemnation process to ensure fair and equitable treatment.

Condemning authority takes 1 acre of a 4 acre retail center. However, this 1 acre parcel comprised 40% of the center’s parking. Condemning authority takes 90% of site including the office building. The remaining site is too small to allow any improvements. Appraisers often reach markedly different conclusions regarding the damages to the remainder. Preparing a credible condemnation appraisal consistent with factual data generally encourages an equitable settlement. O’Connor and Associates is the largest independent appraisal firm in the southwestern United States and has over 40 full-time staff members engaged full-time in valuation and market study assignments. Their expertise includes condemnation appraisals, business valuations, commercial and single-family real estate appraisals, business personal property valuations, purchase price allocation for businesses, valuation for property tax appeals, partial interest valuation, estate tax valuation, and expert witness testimony. They have performed over 20,000 appraisals since 1988.

The appraisal division of O’Connor & Associates is a national provider of commercial property real estate appraisal services including Houston Commercial Comparable Sales, Dallas Fort Worth Commercial Comparable Sales, in Commercial Comparable Sales, San Antonio commercial comparable sales, Commercial comparable sales approach, Commercial land sales, Commercial comparable sales matched pair analysis, Commercial sales confirmation, Comparable sales land abstraction and Comparable sales units of measure. Appraisal services are provided for all commercial property types including 1 multi-family housing, retail stores, hospitals, hotels, industrial properties, manufacturing facilities, medical offices, commercial offices, restaurants, self-storage units, shopping malls, shopping plazas and warehouse/distribution centers.

Often a home buyer that is qualified for a mortgage will find their dream home is still out of their reach. Where their dreams are shattered is in the appraisal process. When calculating loans, mortgage lenders must base the loan on the appraised value of the home which can be different than the price listed by the realtor. The appraisal is just as important as your credit rating and can kill a home sale even if you are pre-qualified.

Before you start thinking of the appraisal as the Big Bad Wolf, consider that he or she must go through a process. As mentioned earlier, the neighborhood and the price of other properties that are comparable are a factor in the appraisal. The appraisal must also honestly assess what it would cost to rebuild the home. Usually the appraiser is selected by the mortgage loan officer. He or she will do a through inspection of the home inside and out. Research will be done on how much that home has been valued in previous years and what other homes are worth in the area.

Get a copy of the report and read over it thoroughly. If the appraisal is not what you expected, you can ask for a review. Many bank and mortgage loan officers ask for a review automatically. Your other options are: You can try to renegotiate the price with the seller, make up any differences with a larger down payment and ask your lender to override the report or at least, get another opinion.

If for any reason you are worried about the appraisal, you can prepare and avoid the surprise of a low appraisal. Most realtors offer a Comparative Market Analysis. Known in the industry as a “comp,” this report will list recent sales or homes in the area. Just keep in mind that the report may not take into the account the uniqueness of each home and any hidden deficiencies. No report can replace the appraisal when it comes to applying for the mortgage.

Low appraisals happen but if you are working with an experienced mortgage loan officer, you can avoid disaster. An experienced lender will recognize an extremely high or low sales figure and can predict that the appraisal will likely not turn out in your favor. And if an appraisal does catch you by surprise, an experienced lender can help you with options including obtaining a different type of loan or increasing the down payment amount. An appraisal does not have to kill your dreams of owning your perfect home.