Real Estate 101

This has been a week of body blows. I’m lucky to be standing upright.

After I steeled myself to accept a low ball offer on the house, lower than we paid five years ago, because I thought it was worth it to move on to the next chapter, all the pieces began to fall into place. We made it through the inspection and a couple of minor repair issues intact, and I started thinning out, boxing up, and getting excited.

I thought I was going to change paths, go to culinary school in January and take my writing focus from healthcare to something I love, and to an industry that offers endless variety and opportunity. I wanted to experience training in a professional kitchen, work in the food industry, and create legitimacy and credibility for me to transition to that world.

And then the appraisal came in low. I didn’t see that coming.

In all the real estate transactions we’ve had over the years, we never had a property that appraised lower than the agreed on purchase price. To be honest, I guess I thought it was really a formality of the process. Never occurred to me that in one fell swoop, an appraisal could knock $40,000 off the value of my home.

Five  years ago we paid $379,000, and there was never a peep of concern about the house appraising high enough to meet that price. Now when I’ve got an offer of $365,000 on the table the appraisal comes in at $340,000. How is that possible?!

I know there are all sorts of technicalities and variables that appraisers consider, and I know the appraisal has to hold up to the scrutiny of the lender’s underwriters. I understand it’s not personal, or based on subjective impressions about the property. But the thing is, the end result is personal to me. I just got knocked down by $40,000, and that’s before the realtor commission and closing fees.

It’s very personal.

The buyers came back with another offer, the exact amount of the appraisal. So now instead of a sucky $365,000, I’m looking at a horrible $340,000.

But wait, there’s more!

We met with the project consultant for our street replacement this week. The street we live on is built on top of a wooden trestle, and that structure is reaching the end of its safe life. It’s scheduled to be replaced, with the work starting next summer. This is a joint project between the city, state, and the federal government. And of course it’s all done under “eminent domain,” which means that we don’t have any choice in what happens. We take the value that is offered for the easement rights during construction, and for the damages that will occur to our property. The offer on the table is $20,000, most of which will cover the replacement costs for the garden and the planters in front of the house. And guess what? If we sell, that goes to the buyer. So we take a $40,000 hit, from the purchase price we paid to the price we’re offered, we still pay commission and our share of closing costs, and the new buyers would immediately receive $20,000 to compensate for the road project.

And…after we were told a year ago that the utility cables strung in front of our house, and actually all along the street, would be moved under the new bridge as part of the project, we’ve now learned that the move of the cables will end at our house. At. Our. House! Is this a conspiracy? I can’t believe that the view we’ve been looking forward to…ok, the view is great, but it would be much better without cables in the way…has now been cut, due to government budget constraints. But the rest of the street still gets that perk. It’s only the last few homes that will get to keep the street level utilities. What were they thinking when they made that decision?!

Our lovely view and unlovely cables

Our lovely view and unlovely cables

I think my head is going to explode.

I can’t impact the issues of the street construction. But I’m not selling like this. I’m not desperate. I don’t know what the answer is, what it could be. But it’s not going to work like this. I’m already feeling bled out. I can’t take any more.

The other fun fact is that we’ll have approximately 4-6 MONTHS that we won’t be able to drive to our house. We’ll have to park way down the street and walk in. Then we’ll have to hire our own contractor and come up with a design for replacing the structures that will be removed during the road and new sidewalk construction, so we’ll have that to sort out too.

My house is already about two-thirds packed and boxed. I’m in chaos at every level, I’ve neglected a lot of my personal priorities…blog, family, friends, changed travel plans at the last minute… in the past few weeks to make all this happen, and now it’s just a mess. I can’t accept this offer…too wrenching. But I also know that the appraisal is out there, and any other offer I get is going to face the same hurdle. It doesn’t matter what offer I have in hand with this appraisal number, and that’s impacted by recent sales in the area of homes with similar square footage and amenities.

How is it fair that my home’s value is impacted by other sales in the area? I understand there’s a process in place to protect buyers and to look at fair market value. But how is it fair that I’m losing all this equity? Where’s the fairness to me?!

I need to breathe, need to regroup, need to think. And I have to decide if I keep packing boxes or start unpacking.

I don’t have the answers today. I probably won’t have them tomorrow, or even next week. But I need to slow down, make a good decision, and then find my resolve.

And one thing I’ve learned…if I should ever have a house to sell again, I’ll pay for my own appraisal before it goes on the market so I know exactly what I have to work with. I don’t want to go through this cycle ever again. And let me be a cautionary tale to the rest of you. At least someone should benefit from this experience, and it looks like it isn’t going to be me. At least not financially.

But maybe this is giving me other skills, other strengths. I hope so. I surely need to find the silver lining, and the sooner the better.

Strength: a river cuts through rock not because of its power but its persistence.

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12 thoughts on “Real Estate 101

  1. I’m so, so sorry that all this has happened….you have to be wondering what’s next?! At least you don’t HAVE to sell; there’s some consolation in that fact.

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    • Thank you Dianna, yes, you’re right…I don’t have to sell. We don’t have “next” jobs lined up, so the timeline is totally up to fate at this point! It helps that we don’t have that pressure. I’m just wondering how and when this will resolve. I don’t mind if it takes a few months, but I hope it doesn’t drag on too long. ~ Sheila

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  2. Culinary School in January?!!! That sounds like so much fun and so you!
    I hope eveything still somehow works out so you are able to pursue that.

    Sheila, I like the strength quote you used to end your thoughts. You are in a difficult place financially with your house there. And I can sense your frustration so much that I began to worry about you when you said you were bled out and can’t take any more. I wondered if I should pick up the phone and check on you (and maybe I should!) Then I read the quote and was reminded what a strong woman you are, and you know that. You’ve been in tougher situations and have stood strong.

    I also love the photo of your beautiful view, wires and all. Why? Because all of our lives are full of wires: the good, the bad and the ugly. But it isn’t the wires I notice. It is the beautiful double rainbow! Probably had just been a storm, huh? Funny how that works.

    As I was preparing the Bible lesson on Job this week for my 2-4 year olds Sunday class, I was reminded of how God encouraged Job through his trials by telling him to look around and see His Glory everywhere. So in class we made glasses from pipe-cleaners and put them on to help us see from a different perspective. Easier said than done when life presents one problem after another!

    I’m not meaning to oversimplify your difficult situation. I completely understand your need to ‘rant’, to have a catharsis of sorts through words. That is good, even healthy, to work through frustrations and feelings this way. You already know this, thus the writing. ツ

    Thank you for sharing this, for being honest, for reminding us that we, too, can make it through various trials. We both know your source of true strength and He will never fail you. Lean in hard! Love you!

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    • Thank you Ann, for all your encouraging words. I know you’re right, and I have to see the view and the rainbows, and look past the cables and frustrating appraisal. I’m coming around, slowly but surely. After all, not much choice! I countered the offer today, we’ll see what happens. In the mean time, I’m planning to start the new month with some return to normalcy, picking up my blog and online friends again, finding my smile, and looking for solutions and options. I’m not sure I’m totally reset yet…that may take a little longer to achieve. But I’m better than I was, and looking forward to seeing how this works out! Happy Sept 1st! ~ Sheila

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    • Oh Marilyn, I’m sorry you experienced this too! I’ve read that appraisers are more strict now than before the housing crash a few years ago…maybe that’s what’s going on. Still, it seems so unfair! But at least you know before you make a decision about selling. Thanks for sharing…I know I’m not the only one to ever experience this, and I’m not saying I want anyone else to feel this frustration either…but it helps to hear other’s stories somehow. Good to hear from you! I’m planning to get myself back to my routine soon…I keep thinking I just want my life back! ~ Sheila

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  3. Just an idea, but have you considered having another appraisal done yourself? It costs around $500 in the Seattle area, so not sure up there. We were home when our appraisal was done, and he was able to ask us a lot of questions that had we not been here our appraisal would have been considerably lower due to him missing some things and lack of knowledge about others.
    You have a lot on your plate, and tough decisions ahead. What a curve ball…

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    • Thank you Denise! Yes, I discussed with my realtor. We got the appraisal and reviewed it to make sure it was accurate. There were a few details I could challenge, but nothing that is worth $40,000. The real issue is that housing values here declined a few years ago, and haven’t recovered yet. And I also hear appraisers now are more strict in their evaluations than before the housing market crashed a few years back. I’m just caught in all the fall out from the market issues of the past few years. I’m thinking about options. I appreciate your encouragement! ~ Sheila

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  4. Ugh. You just have it coming at you from all angles!

    About a year after we bought our old house, the city mandated that everyone on our street and a few others must convert from septic to City sewer at OUR cost. We had no say in the $20K fee and the ONLY positive was that we were young enough in our careers to work it off. We are still paying for it.

    Elderly neighbors who owned their homes outright and had medical bills up the ying yang stood in tears at the City meetings, begging for another solution – i.e. have the City assess a small fee on all residents not just the 100 or so this impacted. No dice.

    Turns out the $20K each of us paid/will pay/are paying is helping pay off the brand new water treatment plant that benefits THE OTHER RESIDENTS.

    You can’t make this stuff up.
    I really feel for your situation and, like you, I’d be taking a deep breath before soldiering forward.
    MJ

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    • Oh MJ! What a story! Yes, you understand how I’m feeling. Of course I’m sorry you’ve had unfair and expensive blows like this. But at the same time, your story and others I’ve heard help me find some perspective. I know I need some time to process before I can get to the stage of shrugging and accepting, which I’m sure I will do…what else is there to do?! But this one stings. Thank you for your encouraging words…you’re so right, you can’t make this up! ~ Sheila

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      • no matter how you wrap your head around it, the situation stinks. I thought the other person’s comment about getting a 2nd appraisal was good info.

        Eventually you will find your way through it ~ doesn’t mean its easy, though. MJ

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