Houselopnik Venting (UPDATED)

"Poor_Sh" (ar4x) 04/05/2019 at 12:34 • Filed to: None

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So here’s the deal: I was really far into getting this house. I was approved for everything, the inspection was done, the septic inspection was done, negotiations were made after the inspections came back. I even told my apartment I’d be moving out in 2 months. I got a dentist near there (because I had to go urgently not because I jumped the gun so much). Then, the appraisal came back noticeably lower than they were asking for, and the sellers won’t budge on the price.

My options were: Back out. Pay $9k more down to keep no PMI. Pay some PMI to make up that $9k difference.

Now, I was already ok with buying it at that price, but the down payment would have been lower than is required now to get 20%. Also, I’d be buying a house with an obviously inflated price. Honestly, it’s not my dream house so I’m not heartbroken. AND even though I was very into this house, I was just never 100% ok with the commute. I’ve been fretting about that for weeks.

I talked with some friends, I talked with my parents, I ran the new numbers, and I looked back at the market to see if it’s a unicorn or not. Ultimately, I told my agent and my lender that I want to back out. It’s not done yet I guess but that’s what I’m trying to do.

What would you do?

UPDATE 4/5 1230 EST:

The seller’s came back at splitting the difference (so from 269 to 264.5) which would still be 4.5 over appraisal and would be a few thousand over what I was originally paying for down payment. However, this is still below what I was originally accepting to pay in total. I wasn’t swayed though so I came back at 263 since that would allow me to put down the same amount I already agreed to put down, and I still have no PMI. So the end result is essentially I save some money compared to what I expected over-all, but technically I am paying about 3k over appraisal.

Then, my lender agreed to a 1k credit to help things out. I think it’s a good deal, it saves me a ton of stress, and I know I won’t find a better house for a long while unless I sacrificed quality for location which I’m not willing to do right now.

Thoughts? I know a bunch of you probably think this is still a bad idea.

E90M3 > Poor_Sh 04/04/2019 at 21:39

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Buy an E60 M5 and live inside.

WilliamsSW > Poor_Sh 04/04/2019 at 21:40

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I would walk if the seller won’t budge.

They’re not going to sell it if they won’t come down. 

BrianGriffin thinks “reliable” is just a state of mind > Poor_Sh 04/04/2019 at 21:41

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I’ve never not seen an appraisal come back to meet the selling price, even when things have ridiculous over-inflated values. Either the appraiser was a dummy or the house was actually like $12k overpriced. Probably for the best. 

WilliamsSW > BrianGriffin thinks “reliable” is just a state of mind 04/04/2019 at 21:45

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It’s VERY rare for a house to not appraise.

smobgirl > Poor_Sh 04/04/2019 at 21:46

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If it’s not your dream house, back out and keep looking. House shopping sucks though. I wish now that I’d been able to scrounge up $10-15k more when I bought because those houses are now worth close to/over $500k (versus mid-high $300s here) , but you can’t predict something like that. 

Chariotoflove > Poor_Sh 04/04/2019 at 21:48

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You need to be 100% sure you want the house if you’re going to buy it. If you’re not, then you shouldn’t. It’s too big a purchase

Sounds like you may never have been that attached. Which is a strong position to be in as a buyer. If the house is priced too high, it’ll likely come down eventually after enough time on the market

imadick > Poor_Sh 04/04/2019 at 21:49

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Back out. The owner is delusional. I’ve met people like this that think their house is worth tens of thousands more than the market dictates. They won’t budge.

ranwhenparked > BrianGriffin thinks “reliable” is just a state of mind 04/04/2019 at 21:50

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Yeah, usually the appraiser knows what number they have to hit, and will do what they have to to hit in the ballpark. 

ranwhenparked > Poor_Sh 04/04/2019 at 21:51

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I’d walk, and if your house search drags on longer than you want (hopefully it doesn’t, but worse case scenario it does), you can always circle back to them later and see if they’ve accepted reality. 

Poor_Sh > BrianGriffin thinks “reliable” is just a state of mind 04/04/2019 at 21:56

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Yeah the appraisal didn’t include a few things like the new shed, so the lender and agents asked for a reconsideration which came back at the same price. So the original ask was 275, I came in at 269, and the appraisal says 260 and won’t budge.

Poor_Sh > Chariotoflove 04/04/2019 at 21:57

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Yeah I feel like this is a big risk for the sellers. Now it’ll go back on the market after anyone watching would have seen it go to contract and back. And, what if the next buyer gets the same appraisal? Are the sellers just hoping someone will pay cash or love it so much they pay over?

Poor_Sh > smobgirl 04/04/2019 at 21:59

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That was my thought as well. I’m out a grand or so on inspections, but if I can find a place with a better commute and some other accoutrements I’d be happier. This house did have great appliances and some new/upgraded work that made it a good value though. Tough to sacrifice that for the unkn own right now.

Poor_Sh > ranwhenparked 04/04/2019 at 22:00

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I was wondering if this would be like “calling their bluff” and they might come back to stop me dropping out.

Poor_Sh > WilliamsSW 04/04/2019 at 22:00

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My thoughts too. Seems risky for them. Glad you all seem to be on my side!

Poor_Sh > ranwhenparked 04/04/2019 at 22:18

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That seems disingenuous...

Poor_Sh > E90M3 04/04/2019 at 22:20

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Ok but can it tow my Cayman?

shop-teacher > Poor_Sh 04/04/2019 at 22:29

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I'd back out. There will be other houses.

nFamousCJ - Keeper of Stringbean, Gengars and a Deezul > Poor_Sh 04/04/2019 at 22:30

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Odds are with the apartment, as long as youre in good standing with them, just let them know your situation. They want to keep you around if they can but they’ll work with you because word of mouth and referral. I told mine I was leaving, staying, leaving, staying, leaving and they were cool with it.

If those sellers are that up their own asses over that much then take a walk. The best way to call a bluff is to walk. 

shop-teacher > smobgirl 04/04/2019 at 22:30

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Same here although to a lessor degree. If I had stretched a bit further, I could have gotten something that didn't need quite do much work and money dumped into it.

Poor_Sh > shop-teacher 04/04/2019 at 22:33

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I’m already sort of doing that, but it is a good point. If they came within like $3k of the appraised value I might be swayed. But, $9k is too much.

Poor_Sh > nFamousCJ - Keeper of Stringbean, Gengars and a Deezul 04/04/2019 at 22:34

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I’m fairly sure I can get an extension if I ask tomorrow. Especially since I have to switch to month-to-month which is way more expensive than a yearly lease.

Neil drives a beetle and a fancy beetle > Poor_Sh 04/04/2019 at 22:38

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It sucks but it’s for the better; even if the housing market is tight no one wants to overpay. They will wake up soon and realize they can’t ask more than a reasonable appraisal.

shop-teacher > Poor_Sh 04/04/2019 at 22:39

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I walked over five grand on a house. Ended up with a bigger house and a bigger garage, for $5k less than we had offered.

WilliamsSW > Poor_Sh 04/04/2019 at 22:48

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Prediction: you walk, the house sits on the market forever, eventually sells for $ 255k. 

Poor_Sh > WilliamsSW 04/04/2019 at 22:53

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I’m certainly gonna watch it. With popcorn.

ranwhenparked > Poor_Sh 04/04/2019 at 22:53

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Eh, its sort of a known thing. Obviously, if the price is way, way off, there’s nothing they can do. But if they can work it out more than one way, and one way hits the right number, they’ll do that. 

WilliamsSW > Poor_Sh 04/04/2019 at 22:59

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My first time buying, I made an offer on a house at 170 , they were asking 180. Place needed a ton of updating - nice bones but literally everything was 40 years old, including the furnace and roof. I got to 173, and they wouldn’t budge from 178, so I passed . Ended up with a far nicer house for 185.

That house sat for another 6+ months and eventually sold for 167.

Chariotoflove > Poor_Sh 04/04/2019 at 23:10

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I think sometimes people just get overly emotional or maybe just get bad advice from their agent. 

Poor_Sh > WilliamsSW 04/04/2019 at 23:13

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Ouch. Good ending though congrats!

Tristan > Poor_Sh 04/05/2019 at 01:19

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Walk.

If you aren’t in love, it’s not worth the additional investment. Worst case scenario, you keep shopping and find something better. Best case scenario, the sellers see you walking and bring their price down. Re member they’re just as far into this deal as you are.

SilentButNotReallyDeadly...killed by G/O Media > Poor_Sh 04/05/2019 at 02:07

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E90M3 > Poor_Sh 04/05/2019 at 06:18

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E92M3 > Poor_Sh 04/05/2019 at 07:37

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A terrible commute will quickly kill the joy of your new house. My first house was 37 miles away from work. I couldn’t afford to buy any closer. Took 1.5hrs each way IF there were  no accidents. It really takes a toll on you after a couple years. 

Manny05x > Poor_Sh 04/05/2019 at 07:41

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Back out. Right now is a Seller’s market i am house hunting myself and the price they are asking for some of these house are ridiculous. I just put a offer on a house but they have like 10 more offers i doubt i get it.

davesaddiction @ opposite-lock.com > Poor_Sh 04/05/2019 at 09:32

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Avoid PMI like the plague. 

Grindintosecond > Poor_Sh 04/05/2019 at 09:38

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Drop em like a backpack after school. Don’t help them make their own bed. Obviously they’re upside down or something, or, great big assholes. Leave them hangin’ with a number 2k less than your final was and let em know to call when they decide to stop wasting everyone’ s time.

9k over appraisal. They didn’t do their comps homework.

Poor_Sh > E90M3 04/05/2019 at 12:21

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All the star(s)!

E90M3 > Poor_Sh 04/05/2019 at 12:22

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Also.

See? This could fix your housing situation. 

Poor_Sh > E92M3 04/05/2019 at 12:23

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Yeah I spent a long time looking at this commute and I think I’m honestly ok with it. Enough people who live near the house have suppressed my fears of big traffic jams so it’s really not any different than my other options (except a few times a year).

Yowen - not necessarily not spaghetti and meatballs > Poor_Sh 04/05/2019 at 12:38

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Appraisals sometimes feel like bullshit, I offered 150 on a house and it appraised at 145, seller agreed to come down to 145. Then a year into living there my neighbor sold for 185 (almost identical townhouse in the same building) . Boy was that appraiser wrong. The market where I live is climbing rapidly, so I imagine appraisals good lag behind that a bit, so at the end of the day I imagine you’ll be fine!

lone_liberal > Poor_Sh 04/05/2019 at 12:39

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I’m going to be honest, I would do it. To be that far down the road and scrap it over a couple of thousand dollars wouldn’t make sense to me.

Funktheduck > BrianGriffin thinks “reliable” is just a state of mind 04/05/2019 at 12:45

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The house my ex bought was way off from appraisal. I don’t remember the number exactly but I wanna say it was about $20k lower. It led to a lot of back and forth but she wound up paying a little over asking price plus closing costs. I wanted to walk away but she loved (loves?) that house. Not my problem anymore.

ETA: just looked it up on Zillow. The “zestimate” is finally in line with purchase price 3 years later. Everyone knows their estimates are always high. Also, funny fact, their estimated rental price is $100 less than she’s paying in mortgage. 

facw > Poor_Sh 04/05/2019 at 12:48

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I don’t think it’s worth freaking out over paying 1% over the appraisal, especially if you thought you were getting a decent deal to begin with. If you like the house, you may as well go for it.

RPM esq. > Poor_Sh 04/05/2019 at 13:11

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If you like the house, these numbers aren’t big enough to really change anything in the long run —you won’t even remember this hiccup in a year. If you don’t like the house that much, congratulations, the appraiser handed you an excuse to walk without losing any earnest money.

Snuze: Needs another Swede > Poor_Sh 04/05/2019 at 13:37

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My wife and I bought a house at the end of 2017 and home buying is easily the biggest hassle I’ve ever been through in my life. And I’ve gone through a lot of bullshit.

But the house looks nice. And I see you’re in R I - mind if I ask where the house is and where you’re commuting to? I used to live up in eastern CT so I’m somewhat familiar with the area.

Sounds like you’ve got a handle on the commute, which is good. A shitty commute is a huge stressor. Mine is 14 miles door to door and depending on when I leave my house it can take 25 minutes or over an hour. But having your own space , and some space between you and your neighbors, is great!

shop-teacher > Poor_Sh 04/05/2019 at 13:42

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Follow your gut.

merged-5876237249235911857-hrw8uc > Poor_Sh 04/05/2019 at 13:49

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Sounds like a good deal.  Only a few thousand over what you wanted to pay, you won’t even remember that in a few years.  It took us over five years to find our house.  It’s still needing some work, but it’s been great having more space for the kiddos.  I wouldn’t think twice about it.  As long as you’re out of PMI, then you’re doing just fine.  Enjoy it.

Manwich - now Keto-Friendly > Poor_Sh 04/05/2019 at 14:05

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If it’s what you really want and you can afford it, go for it.

$3000 over the appraised value is peanuts compared to the overall value of the house.

How long would your commute be?

Chan - Mid-engine with cabin fever > Poor_Sh 04/05/2019 at 14:31

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Glad the various parties are working to sweeten the deal for you.

RacinBob > Poor_Sh 04/05/2019 at 14:36

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As long as you have the money to swing it, I wouldn’t get obsessed with the appraisal. if it is the r ight house, right location, and it doesn’t bankrupt you, trust me 7 years from now you will not give it a second thought. $3500 which is * 1.5% is nothing in the scheme of things.

Now if you can’t make the payments, its not the right house, or the best location, or you are probably relocating in three years, then we have to have a talk as what are you thinking!,

ZHP Sparky, the 5th > Poor_Sh 04/05/2019 at 14:39

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If you’re buying this as a long term home don’t let the few grand difference bug you too much, especially after the lender credit . Presumably you’ll be holding on to it for long enough that it’s not going to make or break you financially.

But I would seriously give the commute more consideration if that’s something you’re on the fence about, and use this opportunity to back out potentially. Presumably you’re going to be commuting everyday - and it directly affects quality of life. No point coming home to a really nice house if you’re sitting over an hour in traffic getting there and are miserable at that point.

It’s really what you feel comfortable with and are willing to put up with. Just make sure you’re not going ahead with the sale simply because you’ve already come this far, or because it’s what you’re “supposed to do” or something like that. There will be other houses if this isn’t the right one. I have a crazy story from before we moved out of San Francisco that seemed like the most amazing option at the time, but now we’re SO glad it fell through. Details upon request.

Party-vi > E92M3 04/05/2019 at 14:41

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SAME.

Baltimore to DC every day. Turrible idea.

ITA97, now with more Jag @ opposite-lock.com > Poor_Sh 04/05/2019 at 16:17

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That doesn’t seem like an unreasonable approach. If it’s the place you want, 3k isn’t going to matter that much over the long-term. On our current house, while there were no financing or appraisal issues, we probably could’ve gone another round or two on the negotiation and gotten another concession or two, or gotten another few grand off the price. However, we came to the conclusion that it was the place we wanted, and a couple of thousand dollars on a 176k purchase was well within the range of de minimis. Over the long term it won’t matter, and not extending the process by starting all over again with something else that may or may not turn out to be better, or may or may not be better deal has some kind of value.

As to the commute, my prediction would be to expect to end up either buying a cheap, boring commuter appliance sooner or later or end up buying a closer house sooner than you might expect. I did the 20-25 k/year commuting thing in a variety of enthusiast cars. Especially in a big boy sports car, it really ups the maintenance and upkeep game and changes the longevity equation (or at least the longevity of the car being a financially viable proposition to big miles on).

Poor_Sh > ITA97, now with more Jag @ opposite-lock.com 04/05/2019 at 17:00

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Good advice. I’m thinking about the cheap commuter thing eventually but I’ll have to see how things go. Right now I’m gonna make my time flexible with telework and non-standard hours if I need to avoid traffic. Mileage it isn’t bad really, 17.5 one way and mostly highway. I get to hit a sweet on-ramp every morning! But, I would go cheap commuter, not boring. NEVER BORING.

Poor_Sh > RPM esq. 04/05/2019 at 17:02

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My thoughts too. I figure the 3k difference now is likely within the tolerance of a year of appreciation/depreciation.

Poor_Sh > Snuze: Needs another Swede 04/05/2019 at 17:04

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Yup my commute will be about 17.5 mi one way and is between 26-40 min. But, there’s HUGE construction in the future on the Newport bridge ramp in Newport so that’s what I’m worried about.

House is in North Kingstown, commuting to Newport/Middletown area.

Poor_Sh > RacinBob 04/05/2019 at 17:05

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Haha yup I think I’ve overthought every little detail enough that I should be safe with a conservative gap too. But, it’s thinking about it that much that makes me stress over these things popping up.

RPM esq. > Poor_Sh 04/05/2019 at 17:05

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Definitely. It also doesn’t help that I live in a real estate market where that tolerance is easily $50k and where I just had to make a similar decision to yours on that basis.

Poor_Sh > ZHP Sparky, the 5th 04/05/2019 at 17:06

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I think it’s hard for me to accept this unknown commute because I’ve spent 5 years living within eyesight of my work essentially. So it’s a huge change no matter what. Realistically, it should only be about 30 min normally and moving at a good pace. We’ll see.

Poor_Sh > Manwich - now Keto-Friendly 04/05/2019 at 17:07

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My thoughts too. Probably within the tolerance of a year of appreciation/depreciation. Commute will likely be about 30min normally with a few days being REALLY FUCKING BAD a year. But, I can likely telework then.

Poor_Sh > RPM esq. 04/05/2019 at 17:11

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Ouch. My area is basically between Detroit and San Francisco pricing (guessing) so I can complain how bad it is, but I can’t REALLY complain.

ZHP Sparky, the 5th > Poor_Sh 04/05/2019 at 17:56

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Oh man, going from no commute to sitting in traffic is rough – but I agree that 30 minutes is reasonable, if that’s realistic and consistent. That’s about the length of my commute right now and it’s just enough to reset from work/home to the other and not get too grumpy about how long it’s taking. Having alternate routes helps too so if it is bad every now and then, at least there’s a less stressful route to take even if it might take a little bit longer.

Manwich - now Keto-Friendly > Poor_Sh 04/05/2019 at 18:53

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Only 30 min?  That’s not so bad.