Why are Appraisals Important? Free Photoshoot and Baseball Season

by Brad Gellman

Spring is already in full swing, and there is a lot going on! Check out my social media to see everything I’ve been working on and what’s coming up. It’s truly the best time to sell your home or start looking for a new one. With all this activity, one of the most common questions I get asked is:

What is an appraisal, and why does it matter?

An appraisal is a professional evaluation of a property’s value, usually ordered by the lender during the mortgage process. The lender uses the appraisal to determine how much they’re willing to lend.

If the appraised value comes in lower than the agreed-upon purchase price, the lender will only finance up to the appraised amount — not the full purchase price. This creates a financing gap that needs to be addressed before the deal can close.

Why it matters:

If the appraisal comes in low, it can disrupt the deal since most buyers don’t have extra cash to cover the difference.

It can also give buyers an opportunity to renegotiate the price or terms with the seller.

A low appraisal might signal that you’re overpaying for the property, which could affect your future equity and resale value.

What you can do if the appraisal comes in low:

Negotiate with the seller – You can ask the seller to lower the price to match the appraised value.

Cover the gap in cash – If you still want the property, you can agree to pay the difference between the appraisal and the purchase price out of pocket.

Split the difference – You and the seller could agree to meet halfway, with the seller reducing the price and you contributing additional funds.

Challenge the appraisal – If you believe the appraisal was inaccurate, you can request a second opinion or provide additional data (such as better comparable sales).

Walk away – If the contract includes an appraisal contingency, you can usually walk away without penalty if the appraisal is too low.

How to prepare for this scenario:

Include an appraisal contingency in your offer — This gives you the option to back out or renegotiate if the appraisal is lower than expected.

Have extra funds available — If you’re in a competitive market, being able to cover a gap could strengthen your offer.

Work with an experienced agent — A good agent can help you analyze the appraisal report, find comparable sales, and negotiate effectively with the seller.

One of my favorite lenders, Corey Gee with Cross Country Mortgage, and I sat down for an interview:

Q: If the appraisal is under purchase price, and the buyer has waived or had an amount that would pay over, is there any way to put that money into the loan instead of being cash out of pocket.

A: Depends. This is definitely an important part of our pre-purchase consultation. If you are maxed at 97% LTV(loan to value) based on the loan program, but you are intended to put down 20%, well then it's easier to waive the financing contingency. If the value comes in low, you would have the opportunity to bring the difference to the table to remain at 80% LTV, or you can simply add some PMI.

2. Anything you suggest that a seller can do to maximize an appraisal.

A: Curb appeal certainly has some impact, but I would make sure that the property is in good working order, no visible defects, and to prepare a list of improvements or additions made. If selling an investment property, be sure you provide valid lease agreements so they can prepare an accurate income approach.

What’s going on in the Philadelphia and Suburban market?

The Philadelphia metro area and its surrounding suburbs continue to see strong real estate activity in early 2025. The median sale price in Philadelphia has climbed to $380,000, reflecting significant growth since 2019 (Philly Mag). The region remains highly competitive, with Philadelphia projected to be the fifth-most competitive housing market in the nation this year (Philly Voice). In the suburbs, Bucks County’s median price reached $470,000 in October 2024, a 5% increase from the previous year (BucksCo Today). Montgomery County saw a 6% rise in home prices, reaching $445,000 in February 2025 (Vista Today). Delaware County followed with a 6.1% increase, bringing the median sale price to $315,000 in February 2025.

Philadelphia Metro Area:

As of March 2025, the Philadelphia housing market continues to experience significant growth. The median sale price for homes in the region has risen to $380,000, up from $247,000 at the end of 2019. This increase reflects a broader trend of escalating housing costs in the area. Additionally, the Philadelphia metro area has been identified as one of the nation's most competitive housing markets, with projections indicating it will be the fifth-most competitive metropolitan area in 2025.

Bucks County:

The housing market in Bucks County has seen a notable rise in home prices. In October 2024, the median sale price reached $470,000, marking a 5% increase compared to the same period in the previous year.

Montgomery County:

Home prices in Montgomery County have also experienced growth. In February 2025, the median sale price was $445,000, reflecting a 6% increase compared to the previous year.

Delaware County:

The housing market in Delaware County has shown positive trends. In February 2025, home prices were up 6.1% compared to the previous year, with a median sale price of $315,000.

Exciting things ahead in 2025!

I want to start by giving a huge thank you to everyone who donated to the CHOP Philly Spin-In Fundraiser to support cardiac research, a cause near and dear to my heart as it directly supports my son... You are all amazing, and I was blown away by your generosity. I also want to thank those who came to the happy hour tied to the fundraiser — it was great to catch up with so many of you and share a fun evening together.

Looking ahead, I’m excited to announce another free photoshoot for all my past and present clients on Sunday, April 27th. The last one was such a hit that I can’t wait to do it again! Everyone is welcome, even if you participated last year.. You’ll get at least 15 minutes to take as many photos as you’d like, and you’re encouraged to bring anyone you want — including pets! We’ll be at the Navy Yard in South Philadelphia from 9:30 a.m. to 12 noon. Spots fill up quickly, so I recommend signing up soon — you can RSVP here.

I can’t believe the Phillies season starts today! My family and I are excited to catch our first game on April 2nd — let me know if you’ll be there! By now, you should have received your Phillies schedule magnet, but if you didn’t get one (or want an extra), just let me know and I’ll get one to you right away.

Finally, I’m planning other great events in 2025, including free tickets to an upcoming Phillies game (date to be announced in the next email), a day at Hershey Park, an outdoor wine and cheese event, and more. Stay tuned for details, and don’t hesitate to reach out if you have any questions. Have a great spring, and I look forward to connecting with you soon!