I don't really agree with kswl on this. I think it's pretty uncommon for good agents to end up in deals where the appraisal is way off the mark. A seasoned agent - and there are plenty - already has a good sense of value and should not have any trouble guiding his buyers. And they have pretty good control over the appraisers that are chosen - not control over the appraiser...but control over which appraiser is used. A good appraiser can make all the difference. And they are usually found through experience.

Do not be afraid of the San Jose real estate market. There is something good for everyone.

I don't know where you live, cabovacation, but in Georgia--aka Foreclosure Capital of the United States---it is quite common for selling prices and appraisal valuations to be different. Even seasoned agents can make mistakes, but more unfortunately it is more often plain old greed--around here, anyway. I am in the business.

Just to add---the idea that agents have any control whatsoever of the appraisal process is not only wrong, it is against USPAP regulations in every state. Mortgage lenders hire appraisers, and although the buyers pay for it the appraiser cannot give them a copy of the appraisal. That has to come from the lender. The idea is to remove the buyer, seller, and agent from the valuation process entirely, in order to protect the bank with a true value of the property in case of default. All these regulations and laws are the result of the Savings and Loan debaucle, the effects of which are still rippling through the mortgage business.

Real estate listings and recent home sale prices are readily availible to anyone who wants to look them up. It is pretty easy for anyone to do their own comps. This is more difficult when purchasing in older areas with many different types and ages of homes, but for anyone buying in any type of tract development, new or old, the approximate value of the house should be really easy to determine.

Hi! kswl....I'm sure this is so boring to everyone but you and me ;)- but I sell real estate here in SJ - and almost always the appraisal comes out the same as the selling price. It is not collusion with the appraisal, but just that we know that the appraiser we pick is one who is an expert in the market - as we are - and thus there are no problems - or extremely rarely. In fact, an appraisal contingency is rarely a necessity. Just a different market!

You are probably right, Cabo! :D I am on the appraisal end, and you wouldn't believe what we see out here in GA. I just appraised a darling little house that was completely renovated, charming farmhouse in the country on about one acre. The comps were a nightmare---about half the available sales were either foreclosures or one out of foreclosure. Basically, the market there <i>is</i> foreclosures. Down here south of town it's usually a straightforward situation of too much financing, no cushion, bad times. Up in Atlanta the fraud is scary. There are a few zipcodes where just about every sale is fraud---

I hope redrock finds a good house out there--

Holy cow! What a nightmare!

Wow - that makes our housing market here sound like a dream. Prices may be high, but things are pretty straightforward and if you have a good agent, things should go smoothly.

We bought in San Jose 2 years ago when the market was really crazy, but our agent was excellent and really steered us through the process. We got into a bidding situation on a couple places and were advised by our agent to walk away rather than bid higher and overpay for the house, so we did. He would have made more money on the sale if he had advised us to try and outbid the other buyers, but he is an ethical person and was looking out for our interests. The house we bought ended up being exactly what we were looking for and our offer was right in line with the rest of the neighborhood.

A final note--I just looked at the latest foreclosure data for the Atlanta metro area. In one county directly to the south, ONE in every 149 sales ends in foreclosure--fastest rate in the area. You see why we have to be so careful, and why my antennae go up when people mention prices way over appraisal values!