Real Estate Analysis and Commentary in Central Florida

Crafting a Successful and Fair Reconsideration of Value Request

As a real estate agent, you are often at the intersection of buyers, sellers, and the appraisal process. Sometimes, the appraised value of a property may not align with expectations, potentially jeopardizing a transaction. When this happens, submitting a reconsideration of value (ROV) request to the appraiser can be an effective tool—when done correctly. Below are key insights from an appraiser’s perspective to help you craft successful and fair ROV requests that increase the chances of a favorable outcome.

Understand the Appraiser’s Role Appraisers are impartial third parties tasked with providing an unbiased opinion of a property’s value based on market data. Their duty is to the lender and regulatory guidelines, not to the buyer or seller. When submitting an ROV, consider you are opening a professional dialogue with a real estate colleague.

When to Request an ROV An ROV is appropriate if you believe there are inaccuracies or omissions in the appraisal report, or if additional comparable sales (comps) were overlooked. Examples include:

• Missing or incorrect data: Errors in property details, such as square footage, upgrades, or amenities. (Square footage or Gross Living Area (GLA) may differ from public records based on the measuring standards appraisers are required to utilize. Features like Accessory Dwelling Units, often called in-law apartments, Granny Flats or Casitas, are not included in the main house GLA.  Enclosed Porches and Patios not under air and not finished liked the main house are also not included in GLA).
• Omitted comps: Recently sold properties that are similar and relevant but not included in the analysis. (Did a potential supportive sale happen to be a For Sale By Owner or mislabeled in MLS?  My market shows errors in labeling Condos and Townhomes frequently).
• Market trends: Demonstrable changes in market conditions that may not have been reflected. (Did something occur that increased values in the subject neighborhood over competing neighborhoods)?

How to Structure an ROV Request

1. Be Professional and Concise Open your request with a professional and courteous tone. Clearly state the purpose of your communication and avoid accusatory language. For example: “Thank you for your thorough appraisal of [property address]. After reviewing the report, we’ve identified some additional information that we believe may assist in ensuring the valuation reflects current market conditions.”
2. Provide Specific and Relevant Data Focus on factual, relevant information that directly impacts the property’s value. Include:
   • Detailed corrections: If there are errors in the report (e.g., incorrect square footage), provide supporting documentation such as a survey or MLS listing.
   • Comparable sales: Share up to three recently sold properties that are truly comparable. Highlight their similarities to the subject property, such as location, size, age, and features. Include sale dates, as older comps may carry less weight.  The ideal sales are closed within the prior 3-6 months, within 20% of the subject’s GLA and share similar value contributing features (pools, water-frontage, view, garage bays, etc.).
   • Market insights: If applicable, present evidence of market trends or appreciation, supported by data from reliable sources.
3. Avoid Common Pitfalls
   • Emotional appeals: Statements like “The seller needs this price to close” or “This value doesn’t seem fair” are unlikely to persuade an appraiser.
   • Unqualified comps: Avoid submitting properties that are vastly different in size, condition, or location, even if they’ve sold at higher prices.
   • Excessive data: Overloading the appraiser with too many comps or extraneous information can dilute your argument.
4. Include Documentation Attach supporting evidence to substantiate your request. This might include MLS printouts, MLS listing numbers, Parcel ID numbers, photos, or written explanations of any overlooked features or upgrades.
5. Respect the Process Understand that appraisers must adhere to strict guidelines and cannot always accommodate every suggestion. Polite language and cooperative approach is more likely to foster a productive dialogue.

After Submitting the ROV Once your ROV is submitted, the appraiser will review your materials and determine whether any adjustments are warranted. Keep in mind:

• Not all ROVs result in changes to the appraised value.
• The appraiser’s obligation is to provide a fair and accurate report based on available data, not to meet a predetermined value.
• Communication is key—be responsive if the appraiser requests additional information or clarification.

Conclusion A well-crafted ROV request can be a powerful tool in resolving valuation concerns, but it requires precision, professionalism, and respect for the appraiser’s role. By focusing on relevant data and presenting your case clearly and courteously, you can help ensure that the appraisal process supports a fair and successful real estate transaction. Collaboration and understanding between agents and appraisers ultimately benefit all parties involved.

Final Thoughts Having a professional, proven, local appraiser in your agent toolbox benefits all parties.  Find your person!  There are many appraisers who are willing to connect and spend a few moments talking through a challenging listing.  Providing your CMA before or at the inspection can be helpful particularly for unusual or feature-rich homes.  And lastly, hiring an appraiser to write your ROV is also an option. 

Personally, I have shared with agents how to submit ROVs on my very own appraisals.  It is just another part of the process, and everyone has a right to double-check the work.  On more than one occasion I did not include the ROV provided sales as they would bring the value down and the subject would not meet contract.  On several occasions the agents learned something new.  Rarely, but it has happened, I miss something, and the value gets bumped up.  I apologize and move on.  We’re all human at the end of the day!

Sunny@embraceappraisal.com

https://www.embraceappraisals.com/