If you’re worried that a high appraisal will give the seller second thoughts about selling their property at the agreed-upon price, you can breathe a sigh of relief. While sellers can certainly hope for a higher appraisal, they cannot change the price or withdraw from the appraisal simply because it’s higher than expected. Here are a few reasons why:
The seller and buyer have already agreed on a price: When you make an offer on a property, both parties agree to a specific price. Unless the seller included a contingency clause in the sales agreement that allows them to adjust the price after the appraisal, they’re legally obligated to stick to the agreed upon amount.
The seller could be breaking the sales agreement: Backing out of a sale after agreeing to sell at a specific price is a breach of contract. If the seller decides to try to re-list the property at a higher price after the appraisal, they could be held liable for any damages incurred by the buyer.
Appraisals are just estimates: While appraisals play an important role in the home buying process, they’re not always perfect. It’s possible that another appraiser could come in with a lower valuation, or that the buyer and seller could negotiate over items identified in the appraisal as needing repair.
Overall, it’s rare for a seller to change the price or withdraw from an appraisal simply because it’s higher than expected. As a buyer, it’s important to have a good understanding of the sales agreement and to work with a trusted real estate agent or attorney who can guide you through the process.