Appraisals are becoming the bane of the Real Estate world. Banks that have customers in the short sale mode are over estimating the value of the property to assure that they get the greatest dollar value for the property. Foreclosures are undervaluing property, then putting an overly attractive price tags on a property which then results in price wars on undeserving properties. Mortgage lenders are undervaluing properties and offering insufficient financing for properties.
The buyer and sellers are the ones who lose in this writhing market. Most realtors are have a difficult time advising customers on how to bid for a property. If the customer bids too much, they may get the property, but can't get a loan. Conversely, if a customer bids too low, the offer is rejected by the foreclosure bank which typically doesn't counter offer, just accepts the highest and best.
Currently no convenient answer exists as to what the buyer or seller should do. However, the first step in either buying or selling your property is to ask your realtor for comparables of the property. For a seller, it may be worth the $200-400 to have an appraisal done that can be included in the MLX listing. (That is if it supports your asking price.) For buyers, have your realtor explain their purchasing strategy on how to best get the property you want. (Negotiating has a different strategy than bidding.)
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