Expert: Dick Dennis - 3/2/2005

Question
We bought my father's house from him last year - we had agreed on a price of $65k (it is a 22 year old manufactured house on 1.1 acres)  He had it appraised before the sell and the appraisal came back at $56k.  The appraiser ever said that he thought it should sell for 70-75k but because there are so few manufactured homes in this area he had to go outside the area to get a value.  Not sure about that, but we bought it for the 56k.  Now, we are getting ready to sell it, and want to ask 70k.  It is in an EXCELLENT area, best school district in area, and they have just started building a 30 home subdivsion right next to us with homes starting at 160k.  My question is, should we get it appraised again and hope for a much higher appraisal - or should we just ask what we think it is worth?  I'm worried if we do that, any potential buyer is not going to want to purchase a house so much above the appraised value.  What do you recommend?

Answer
What the appraiser probably did, Anne, was to first compare the value of the land with other comparable parcels. You should do the same.

Then compare the value of similar-sized homes, manufactured or otherwise, to get an approximation of what houses sell for in a comparable area. Your property is most likely larger than others in the area. So, that is a higher value.

The house is probably of lesser value because of its construction. All this just serves to give you an approximation. But be aware that a manufactured house is inherantly a cheaper-built house and people know this.

So, if you feel that the house is worth x-amount, then try that price and see what happens. Do not hesitate to ask a Realtor for his/her opinion of value, too. If you use that person to sell the property, fine. If you want to try selling it yourself, that's fine, too. But be aware that a GOOD real estate agent is usually worth the fee he/she charges. And do not hesitate to pick the brain of that agent. That will give you a pretty good idea of value.

Be careful, though. Some agents may appraise the property for a higher value to get you to sign up with them.

Not knowing where this property is located, this is the best I can do for you, Anne. I do wish you well.

Dick Dennis,    dixiedee13@aol.com