Getting an unjustified or inflated property valuation can negatively impact finances and investment plans. Here’s a step-by-step guide to contesting a problematic appraisal.
Review the Full Report
Carefully go through the entire valuation report to identify issues. Check for errors in property details, faulty assumptions, inappropriate comparable sales, questionable adjustments etc. Note down inaccuracies with evidence.
Gather Supporting Data
Collect additional data that contradicts the report’s conclusions. This includes comparable sales not used in the report, facts about property condition overlooked, more recent sales data etc.
Identify the Basis for Appeal
Determine the main grounds for appeal based on your review. Typical bases include use of flawed comparable sales, factual errors about the property, improper valuation methods, out-of-date data etc.
Know the Appeal Options
For tax assessment appeals, contact the county assessor’s office. For valuations from banks and lenders, submit a reconsideration request. Get appeal form details from relevant authorities.
Prepare an Appeal Letter
Write an appeal letter challenging the valuation and requesting a revision. Outline the grounds for appeal, issues with the report, supporting data and your assessment of fair market value. Be factual and firm.
Submit Supporting Documents
Attach documents like additional comparable sales listings, inspection reports highlighting property condition, market trends data, your competing valuation etc. Make your case with evidence.
Be Ready to Negotiate
The appeals body may contact you for clarification or suggest their own revised valuation. Be cooperative but stand firm on facts. Be ready to negotiate to an acceptable fair value.
Get Expert Help if Required
For complex commercial valuations, consider hiring a qualified appraiser to independently review the report and prepare an expert rebuttal. This adds credibility.
Challenging a faulty valuation takes work, but pays off by correcting property value used for taxes, loans, sales etc. Arm yourself with data to dispute inflated or unsubstantiated appraisals.