Hi everyone,

Posting here to vent/see if anyone has any tips for dealing with low ball appraisals.

The subject property is a 4plex located in Limoges (four self-containing units, 2 bed 1 bath each).  Age of building is approx. 40 years.

We recently had the building appraised after completing a renovation of one of the units.  The subsequent new lease for this unit added over 5k/year in gross rent.

The appraisal came back low in our opinion (implied GIM of 12.93) so we requested a second opinion.  The second opinion appraisal came back at a value 30% lower than the initial one (implied GIM of 10.00) even though the comparables that were used had an average GIM of approx. 15.

Further, the value from the second opinion is actually 50k lower than the value from a previous appraisal completed in late 2020 even though gross rents have increased nearly 15% in that time.  Note that there have also been no other changes to the property that would detract from its value.

Has anyone dealt with this degree of variance between 2 appraisals (initial and second opinion)?  Especially ones that were completed in quick succession (about 6 weeks apart). 

Any tips on escalating for further challenge?

Appreciate any feedback

Joe