Real Estate

Appraisals on New Constructions bought in 2017 - Anyone get a low appraisal recently?

  • Last Updated:
  • Apr 4th, 2019 1:56 pm
[OP]
Newbie
Nov 27, 2018
10 posts
6 upvotes

Appraisals on New Constructions bought in 2017 - Anyone get a low appraisal recently?

Hi All,

I close Sept 2019 on a new construction in bowmanville. Paid a high price (FOMO GOT ME). Anyone in this situation? House has not been appraised yet but want to know what I am up against, Id like to put 20% down but it all depends on the appraisal.
16 replies
Newbie
Apr 16, 2010
8 posts
1 upvote
You're not alone. Too many people are in the same situation and many choose not to close .
Deal Guru
Feb 29, 2008
14213 posts
10524 upvotes
roamer86 wrote: You're not alone. Too many people are in the same situation and many choose not to close .
Yep.
Deal Fanatic
User avatar
Sep 8, 2007
9004 posts
10283 upvotes
Way Out of GTA
Let’s be clear you bought at an artificially high price pushed up by book a house flippers. Which you might be also.

So it’s not a low price, it’s the current market price you probably got appraised at.

One look at Kijiji and there’s a bunch caught in the same scenario now desperately trying to rent out brand new houses that they don’t want to sell at a loss. At this I laugh since anyone who has rented a house out out here will attest to, the house will basically be destroyed by the tenants big slobbering dogs, etc. The sad owners of these properties usually with agents in Scarborough trying to rent or sell.

Sorry, if it brings me joy. But after seeing the pics of the fights in the line ups with the whole family in line each looking to book a house and thinking who with a brain wants to be caught up in this? “My uncles made bank doing this, so I’m gonna get in on it!”

Either close or declare bankruptcy.
Member
Aug 16, 2011
364 posts
234 upvotes
OTTAWA
what were you thinking in 2017? bowmanville? wonder how the million dollar newmarket and barrie properties are doing now.
Member
Feb 12, 2008
212 posts
191 upvotes
Toronto
nununugget wrote: Hi All,

I close Sept 2019 on a new construction in bowmanville. Paid a high price (FOMO GOT ME). Anyone in this situation? House has not been appraised yet but want to know what I am up against, Id like to put 20% down but it all depends on the appraisal.
Before stressing or spinning yourself into depression based on feedback provided here, contact your bank and talk to a mortgage advisor who has a few years experience. In my case my current mortgage is with RBC and I knew (at the time) Mattamy was sending business to RBC. Signed purchase agreement in 2017, entered a rate commitment agreement for my full purchase amount minus 20% (most of which paid already by deposit structure) prior to B20, which I renew every 120 days. After approval from "head office" or lending approval team I had my agent confirm as long as my household income, open debt and employment doesnt change no further reviews or assessments will be completed (including of the home).

If you purchased this home as your primary residence (like I did) and NOT as a short term investment, as long as you can comfortably afford your living expenses don't worry. Long term you will be ok.

Please don't hammer me for my agents name, I don't want the entire internet harassing him because I name dropped. For the crabs who will inevitably ask for "receipts", put $1500 in trust in any law firm in Durham, plus cover legal fees and I'll be more than interested in providing receipts for your curiosity.
Newbie
Mar 17, 2019
64 posts
39 upvotes
if you are putting 20% down you are in a good position... if your bank doesn't approve the mortgage amount, than try another lender and worst case you can reach out to mortgage broker who can help find you a lender willing to cover the appraisal amount.

In worst case situations when appraisals are too high and banks won't provide the mortgage, I have heard of individuals who get 70-75% of their mortgage value from the bank, and the remaining 5-10% from an alternative lender to cover the remaining down payment. you end up paying a bit more on the total mortgage payment but it is not bad for short term to get the deal closed and into your home. after 2-3 years you can roll that loan back into your mortgage.
Deal Addict
Dec 30, 2012
1098 posts
1147 upvotes
Toronto
cartfan123 wrote: Let’s be clear you bought at an artificially high price pushed up by book a house flippers. Which you might be also.

So it’s not a low price, it’s the current market price you probably got appraised at.

One look at Kijiji and there’s a bunch caught in the same scenario now desperately trying to rent out brand new houses that they don’t want to sell at a loss. At this I laugh since anyone who has rented a house out out here will attest to, the house will basically be destroyed by the tenants big slobbering dogs, etc. The sad owners of these properties usually with agents in Scarborough trying to rent or sell.

Sorry, if it brings me joy. But after seeing the pics of the fights in the line ups with the whole family in line each looking to book a house and thinking who with a brain wants to be caught up in this? “My uncles made bank doing this, so I’m gonna get in on it!”

Either close or declare bankruptcy.
A bit presumptuous don’t you think? Maybe the OP bought the house to live in long term.
Deal Addict
Jul 3, 2007
3318 posts
3648 upvotes
Toronto
nununugget wrote: Hi All,

I close Sept 2019 on a new construction in bowmanville. Paid a high price (FOMO GOT ME). Anyone in this situation? House has not been appraised yet but want to know what I am up against, Id like to put 20% down but it all depends on the appraisal.
check market sales that are recent, within 90 days or so, and make sure its a comparable property to yours.....that will give you an idea of what is gonna happen,......

use bungol or housesigma , make an account and you'll get sold data ....
Member
Nov 5, 2009
225 posts
139 upvotes
the builders in Edmonton used a personal guarantee on the condo docs when the one recession hit and people tried to walk away from their pre con condos.

Interesting to hear people are walking away from their purchase with out much of a fight.

I would be referring to your contract to see what the terms are for not closing before you do much. If there are clauses like a personal guarantee you'll be closing weather you want to or not.
Member
Jan 6, 2012
273 posts
79 upvotes
nununugget wrote: Hi All,

I close Sept 2019 on a new construction in bowmanville. Paid a high price (FOMO GOT ME). Anyone in this situation? House has not been appraised yet but want to know what I am up against, Id like to put 20% down but it all depends on the appraisal.
Not trying to scare you, but you could be in trouble...bolded quote, you make it sound like you have 'options' on what you are going to put down, but you may not have many options at all. If you are able to close, likely appraisal wont be the current value and you'll have to put your 20% plus the difference to get the mortgage. If you can't close you will be lucky to just lose your deposit, that likely wont happen though, the builder will try to make you pay penalties...but that still might be better than trying to close and paying private lender(s) to make up the difference in appraised value. One of the handymen I know who sometimes helps me with odd jobs relayed a story to me ~ a month ago - 2 family members both bought similar priced houses that closed recently-the first person realized he couldn't afford it/couldn't get mortgage forfeited his deposit of $50k and walked away, the other went ahead and closed had to get some time of private financing and the monthly costs, lenders fees etc have him currently $125k in the negative...and counting. Like other posters have said you really need to assess your situation, if the home is for you vs. was for a flip, can you manage higher carrying costs, etc. because even if you decide to rent and hold it might be a while before you can get a higher value for the home than you bought it for because those homes in Bowmanville/clarington area eventually sold for waaaaayyy overpriced in the FOMO april 2017 market.
Member
Aug 16, 2011
364 posts
234 upvotes
OTTAWA
I hope this happens to the $1000+ ppsf condos in Toronto in 3 years... i'll have all this cash saved up to help those who can't close when interest rates are at 5%... but i'll be asking for a nice discount from the amount that bought for me to accept assignment
Deal Addict
Jul 14, 2002
2594 posts
1213 upvotes
HODL if you bought it to live in and not to flip.
Member
Aug 16, 2011
364 posts
234 upvotes
OTTAWA
dantey wrote: HODL if you bought it to live in and not to flip.
I don't think HODL applies to houses... if the bank's won't lend to you.. you're out of luck unless you go to private lenders who'll charge you 10%
Jr. Member
Jan 31, 2013
118 posts
106 upvotes
Toronto
cartfan123 wrote: Let’s be clear you bought at an artificially high price pushed up by book a house flippers. Which you might be also.

So it’s not a low price, it’s the current market price you probably got appraised at.

One look at Kijiji and there’s a bunch caught in the same scenario now desperately trying to rent out brand new houses that they don’t want to sell at a loss. At this I laugh since anyone who has rented a house out out here will attest to, the house will basically be destroyed by the tenants big slobbering dogs, etc. The sad owners of these properties usually with agents in Scarborough trying to rent or sell.

Sorry, if it brings me joy. But after seeing the pics of the fights in the line ups with the whole family in line each looking to book a house and thinking who with a brain wants to be caught up in this? “My uncles made bank doing this, so I’m gonna get in on it!”

Either close or declare bankruptcy.
You sound like a bitter, priced-out renter.
Deal Fanatic
User avatar
Sep 8, 2007
9004 posts
10283 upvotes
Way Out of GTA
Reakt0r wrote: You sound like a bitter, priced-out renter.
Your post is what happens to a perma bear who short circuits when met with pragmatic reality. It's good to know your bear grudge carries forward from your other sky is falling for everyone posts on other threads.
Jr. Member
Jan 31, 2013
118 posts
106 upvotes
Toronto
cartfan123 wrote: Your post is what happens to a perma bear who short circuits when met with pragmatic reality. It's good to know your bear grudge carries forward from your other sky is falling for everyone posts on other threads.
Uh... right. Might I recommend removing the stick from your rear end and learning how to take a joke?

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