Recently, the MLS Committee has fielded questions about the practice of changing the price of a property after it is under contract. In response, the MLS Committee provides the following information...
“It is unwise for several reasons:
- All appraisals done for mortgage purpose require the appraiser to account for ALL history and activity of the subject property within the past 1 to 3 years. That would include, the original list price and any price changes…up or down. It could appear to an underwriter…and appraiser that there was an intention to deceived…which is never a good idea
- One of the most important forecasting tools is tracking and measuring the difference between list price and sales price. Re-listing the property at sales price will produce false readings and skew the list-to-sale ration LOWER than it is
- If the practice is to make the appraiser feel comfortable that the property did not sell above list price, it has the opposite effect
In short, this practice is not effective and counterproductive.”