Can I negotiate after an appraisal?
Can you still negotiate after an appraisal? Yes — and here’s exactly how to do it so you win the sale.
Quick answer
Yes. You can negotiate after an appraisal. Appraisals don’t lock the deal. They are data points. If the appraisal comes in low, sellers in Milton, Ontario have clear, repeatable options to protect their sale price or recover the deal. Do one thing at a time. Be direct. Move fast.
Why appraisals matter — and why they don’t have to kill your deal
Lenders use appraisals to limit risk. If an appraisal is lower than the agreed sale price, the lender may refuse to fund the full mortgage. That creates a gap between buyer financing and the purchase price.
But appraisals aren’t the market. An appraisal is one professional opinion based on comps and adjustments. In shifting markets like Milton’s — where demand has been strong but price growth slowed in 2023–24 — appraisals can lag behind real buyer behavior or miss local premium factors (school zones, upgrades, lot position).
For sellers, that means an appraisal is a problem to solve, not a verdict.
The six routes sellers can take after a low appraisal
- Renegotiate the sale price with the buyer
- Most straightforward. Buyer agrees to reduce the price so the loan aligns with the appraisal.
- Use immediate, evidence-based negotiation: show comparable accepted offers, not just list prices.
- Buyer covers the appraisal gap with additional cash
- Buyer brings extra funds to the closing to cover the difference.
- This is common when the buyer really wants the home and can add cash without breaking financing.
- Seller provides a credit at closing or reduces price slightly
- Seller offers a closing credit to the buyer or reduces price to bridge the gap.
- A small concession can save a sale and preserve the closing timeline.
- Ask the lender for an appraisal review or second appraisal
- Lenders can order a review or authorize a second appraisal. Not guaranteed, but worth pursuing if appraisal has clear errors.
- Present a strong comparable package to challenge the appraisal
- Provide the appraiser and lender with better comparables, recent sale evidence, upgrades, permits, and any unique property facts the appraiser missed.
- Walk away or accept termination based on contract terms
- If the buyer has a financing condition and cannot close, the seller may terminate and relist. Only use this if negotiation fails and market conditions favor a relist.
How to pick the right route in Milton — fast decision framework
- Check contract terms: does the buyer have a firm financing waiver or a financing condition? If waived, the buyer must close regardless of appraisal.
- Assess buyer profile: is this an investor, a pre-approved buyer, or a conditional buyer? Investors can sometimes add cash or shift financing.
- Evaluate time-to-relist: in Milton’s market, how long will a relist take? If inventory is low, relisting can fetch a strong price. If inventory is high, try to negotiate.
- Cost-benefit math: compare the cost of a price reduction/credit vs. months on market and carrying costs.
Decide within 48 hours. Speed matters.
Exact steps to take the moment the appraisal comes in low
- Read the appraisal carefully. Look for factual errors: incorrect square footage, wrong bedroom count, outdated condition assumptions.
- Prepare a comparable package: accepted offers from the last 30–60 days, high-quality photos, upgrades list with permits, and any community or municipal changes that add value.
- Call the buyer’s agent immediately. Be direct: state options and a proposed path. Get a response window (24–48 hours).
- Send the package to the lender and appraiser if contesting. Be factual, not emotional.
- Propose creative fixes: split the gap, seller credit for closing costs, or a short postponement for a lender review.
- If negotiations stall, prepare to relist with improved marketing and updated pricing strategy.
Scripts that work — use these word-for-word
To the buyer’s agent:
“Appraisal returned at $X. We have immediate comparable evidence showing accepted sales at or above the contract price within the past 30 days. Would your client consider covering the difference in cash, or would they prefer we adjust the price by $Y? Either way, we need a decision within 48 hours so we don’t miss additional market windows.”
To the lender/appraiser (challenging appraisal):
“Please review the attached comparables and photos. The appraisal omitted two recent accepted sales within a 1.2 km radius and undervalued a permitted addition. Can you confirm you will review these facts?”
Local market insight — Milton, Ontario (what to use in your negotiation)
- Inventory trends: Milton has seen historically tight inventory followed by pockets of increased listings during market shifts. That means well-priced, well-marketed homes still move quickly.
- Buyer profile: Many buyers are Ontario commuters and growing families. They pay premiums for good school zones, newer finishings, and larger lots.
- Comps matter more here: Appraisers in Halton Region rely on MLS comparables and municipal records. Provide them updated MLS accepted offers and any recent renovations with permits.
Use local facts in your package: nearby sold prices, distance to QEW/401, school catchment value, proximity to GO transit, and recent nearby upgrades that sold at a premium.
When to fight and when to fold
Fight when:
- Appraisal has factual errors.
- Recent similar sales support your price.
- Market data in Milton shows buyer demand for your property type.
Fold when:
- Market comps consistently support the lower appraised value.
- Buyer cannot afford to add cash and lender denies a review.
- The cost to hold and relist exceeds the concession required to close.
Don’t be stubborn. Negotiate like a closer, not a martyr.
How a seasoned agent handles this differently
Top agents don’t wait for appraisal problems. They preempt them:
- Build a comps dossier in advance and share with the buyer’s agent at offer.
- Highlight permitted upgrades and provide statements of work.
- Recommend financing clauses that reduce appraisal risk when possible.
When trouble appears, experienced agents move fast, present crisp evidence, and make one clean proposal. That’s how deals close.
Proven negotiation moves for Milton sellers
- Offer a small closing credit to keep the contract intact.
- Split the gap: seller lowers price slightly, buyer covers part in cash.
- Request a second appraisal or lender review if appraisal omitted key comps.
- Reopen negotiations with a tight deadline — 24–48 hours.
These moves keep momentum and limit time on market.
Case example (typical Milton scenario)
A 3-bed detached in central Milton went under contract at $850,000. Appraisal returned at $820,000. The seller provided a comparables packet showing two accepted sales at $845–860K within 2 weeks. The buyer’s lender ordered a review. Review adjusted the valuation to $845K. Buyer added $5,000 cash and seller reduced price by $5,000. Deal closed.
That outcome is repeatable when you act fast and present clear evidence.
Closing — summary checklist
- Read appraisal for errors.
- Collect 3–6 recent accepted comps (not just list prices).
- Communicate directly and set a 48-hour decision window.
- Consider split-gap solutions before relisting.
- Use lender review as a lever, not a guarantee.
If you want a fast appraisal challenge package or a negotiation plan tailored to your Milton property, call Tony Sousa at 416-477-2620 or email tony@sousasells.ca. He knows local comps, lender patterns, and how to get stalled deals across the finish line.
FAQ — Offers, Negotiation & Appraisals in Milton
Q: Can a buyer back out if the appraisal is low?
A: If the contract includes a financing condition tied to appraisal, yes. If the buyer waived financing, they typically must close regardless of appraisal.
Q: How long do I have to challenge an appraisal?
A: Act fast. Lender and appraiser timelines vary, but you should start within 48–72 hours of receiving the report.
Q: Will a second appraisal fix a low value?
A: Sometimes. A second appraisal can differ but lenders don’t always accept a new appraisal without cause. Use it when there are clear errors or missed comps.
Q: Should I reduce price or offer a credit?
A: Choose based on market timing and buyer profile. Credits can preserve the headline price for marketing; price reductions can attract new buyers if you relist.
Q: Does Milton’s market favor relisting after a low appraisal?
A: It depends on inventory and season. In low-inventory periods, relisting can yield higher offers. In buyer-heavy periods, negotiate to save the sale.
Q: What documentation helps overturn a low appraisal?
A: Recent accepted offers, permit records, contractor invoices, professional photos, and a summary of unique property features.
For a customized appraisal challenge or rapid negotiation plan in Milton, contact Tony Sousa: tony@sousasells.ca | 416-477-2620 | https://www.sousasells.ca
Tony delivers direct, evidence-based negotiation that closes deals. No drama. No guesswork. Just results.
