Looking for answer to the question, specifically in the McKinney/Anna area. What is the average cost of a real estate appraisal for a new build, 2600 sq ft home? My son was quoted $700 for this, and had to be paid for up front, not at closing. Just wondering if this is a competitive price. Thanks.

Calling HoneyBeez....

Don't know on the amount, but up front is customary for appraisers.

Your post indicates your son is engaging the appraiser. Is there no lender involved? Is this a custom home or a production home? Sounds kind of high to me if it's a "to be constructed" appraisal and no inspection/measurements, etc. are required of the appraiser. In other words, the appraisal is based on plans. Most appraisals ordered by lenders are paid at closing. Need more details.

Kinda pricy if for a tract home - this guy averages $400 - https://www.bj-appraiser.com/Services

That is on point for pricing in the current times right now for that. I would go down there for $700 and get it knocked out but lenders have guidelines and procedures so that would not work unfortunately. Also, the appraiser gets paid his fee and then an appraisal management company who is the third party adds their fee onto that. The appraiser here is only probably making $550 or so and the AMC is taking the rest.

That makes sense. My son will have a 130k mortgage on a $450k home that will be finished by Sept 30th. The preferred lender of the homebuilder is requiring the $700 fee be paid up front. I haven't had a mortgage in quite a while, but I never remember paying up front, only at closing. Since there's so much equity in this home, is there any way to waive the appraisal totally?

There actually is and with the numbers you just gave me it may be and they will just settle it at closing if an appraisal is not completed. They take the money up front and it sits with the title company because I am on around a 60-90 day wait on orders completed.

Edit to add: They also are probably covering if they do have to have the appraisal and the appraiser goes out next week and completes it the house will need a final once it is completed. $550+$150=$700

My understanding as well. This is not far from you, in Anna, TX. Stonehollow homes IIRC.

We’ve seen as high as $1,000 during the craziness of last year. Strange thing is, I’ve seen more lenders waiving appraisals this year vs last year, and the market this year is unpredictable

It’s all a scam anyways. Had an appraisal come back today, he got the square footage exact based on the build plan and managed to unbiasedly put the appraised value at exactly the contract price. It’s amazing how accurate they are when they have all the information in their hands

You just described a desktop appraisal that he got paid $75 and decided to put his career on the line for. I am not that guy but they are out there.

I’ve heard of 700-1000 pretty regularly last several months.

We just paid $700 in the Weatherford area last month on our custom home. Ridiculous BS

sounds reasonable. in a lot of cases you are paying for the appraisal and for having it reviewed by a different company. However for a simple home build I doubt there is a review process.

Hell, I thought almost everyone on this forum paid cash for their homes

So, seriously......it's common in that part of the world to charge $700 for a $130k mortgage on a $450k home?

I would be more concerned about the September 30 finish date than the appraiser's fee. That's too fast for quality work.

I don't see what the $130K mortgage has to do with the appraisal. The lender wants to know what the house is valued at (appraisal documentation, which you are paying for), not what you think it will sell for ($450K).

It's been under construction for 5 months already and the Sept 30 date was suggested by the builder. I still fail to see the need for a $700 appraisal for a home the sells for $450k. According to my math that's $320k in equity the day he moves in. What's worse is that the mortgage broker is in McKinney, and if anyone should know the market that's right in their backyard it would be them, I thought anyway. Maybe I'm missing something.

Nope...........theyre crooks at this point............an appraisal should not be needed in the OPs loan.

When I was still building homes the appraisal was done before ever breaking ground, using the house plan and a semi-itemized list of the components that were going into it. In some cases a local bank may appraise it in house themselves. Five months into construction doesn't make much sense unless the project was going to go over budget or something was added to the plan. Even so, with the OP's high equity I don't see the need for the appraisal.

"Nope...........theyre crooks at this point............an appraisal should not be needed in the OPs loan."

An appraisal is a requirement if the loan is to be sold in the secondary market. Most are.

There's a couple reasons why it's being done on the back end. I for example can do mine up front off of plans, specs, and cost breakdown if borrower is carrying the loan and then do a recert and final for $250 to confirm home was built to specs provided. This is on my 1X close construction loans. If OP is purchasing final product from builder and builder carried the contsruction then a full appraisal is required by lender if going secondary market. Fannie/Freddie guidelines will most likely require an appraisal for it to be sold/serviced as someone else said, despite the LTV %. All of my appraisal waivers are exising homes.

Price is accurate unfortunaly for a new construction project. I've had them as high as $1300 for new builds on acreage.

Info is most appreciated fellas.