Do Appraisers Consider FSBO Properties in Comparable Listings?

As an appraiser, I get asked questions frequently by Real Estate agents.

Question:


"Do appraisers consider FSBO (For Sale By Owner) properties in their comparables? I have a FSBO that never hit the MLS and it is going for about $20,000 less than the value. It is a mother selling to a son situation."

Answer:


Appraisers do look at FSBO sales but rarely use them as comparables because sales used in an appraisal must be verified as to the conditions of the sale I.e. non arms length, short sale, real estate owned etc. and it is rare that the seller of a FSBO can be located or questioned.

The one case where sales not included in the MLS are used is new construction in subdivisions that do not utilize the MLS. In this case the actual contract and HUD-1 would be reviewed from the developer's sales office and therefore are a verified sale.


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