Home appraisers pressured to fudge the numbers
As market slows, buyers may find they paid too much
Moss blankets the house’s roof. The siding is rotting off. And mold has spread through the interior.
But the home’s condition is “average,” according to an appraisal.
It’s one clear example of how many appraisers hide problems and affirm inflated prices willingly or under pressure from the mortgage brokers and bankers who give them business — calling into question whether home buyers are getting what they pay for.
“We’re pressured to hit the value every time, every single sale,” said appraiser Richard Hagar, who showed pictures of the mossy house while teaching a class on mortgage fraud earlier this month for 25 appraisers, mortgage brokers and real estate agents.
It’s a problem that is more common as buyers vie to outbid each other in recent go-go markets such as Seattle’s. And increasingly buyers may find in coming months that they paid too much, as slowing appreciation and rising mortgage interest rates force them to sell at a loss.
“I think we’ll see it come to a head here in the next year or so,” said Ralph Birkedahl, manager of the state’s appraisal program. “We may see more foreclosures than we’re seeing now.”