You've accepted an offer, you're under contract, and things are moving along — then the buyer's lender orders an appraisal. For many sellers, this is the part of the transaction that feels most out of their control. Here's how appraisals actually work, what sellers can do to prepare, and what to do if the number comes in lower than your contract price.
Why Lenders Order Appraisals
When a buyer takes out a mortgage, the lender is advancing money secured by the property. Before lending $380,000 on a home, the bank wants independent confirmation that the home is actually worth $380,000. That's what an appraisal does — a licensed, independent appraiser evaluates the property and delivers a formal opinion of value.
The appraiser is hired by the lender (not the buyer), assigned through an appraisal management company to ensure independence, and follows strict guidelines. They're not there to negotiate on anyone's behalf. They're there to protect the lender from lending more than the collateral is worth.
What Appraisers Look At in Hampton Roads
The appraiser will visit the home for a physical inspection, typically lasting 30–60 minutes. They'll note:
Square footage, lot size, bedroom and bathroom count, age and condition
Upgrades: kitchen, bathrooms, HVAC, roof, windows
Condition issues: deferred maintenance, water damage, outdated systems
Location factors: proximity to military bases, noise corridors, flood zones
Then they pull comparable sales (comps) — homes similar to yours that sold in the last 3–6 months, ideally within a mile or two. In Hampton Roads, recent comps are generally strong: values appreciated 4.17% in 2025, and the market has maintained healthy activity through 2026.
How Sellers Can Prepare
You can't tell the appraiser what value to assign — but you can make their job easier and reduce the risk of a low appraisal:
Have comps ready. Prepare a list of recent sales in your neighborhood that support your price, especially any sales your agent isn't sure the appraiser will find. If a comp is strong but technically outside the typical search radius, flag it.
Document upgrades. Create a one-page summary of improvements made since purchase: new roof, HVAC system, kitchen remodel, added square footage, etc. With costs and dates. Appraisers can use this to justify higher adjustments.
Be present (or have your agent there). You or your agent can point out features the appraiser might otherwise miss — the custom built-ins, the high-end appliances, the brand-new tankless water heater.
Clean and declutter. Appraisers are supposed to be objective, but condition matters. A clean, well-maintained home signals care. Obvious deferred maintenance triggers downward adjustments.
What Happens If the Appraisal Comes In Low
If the appraised value comes in below the contract price, the lender will only lend based on the appraised value. This creates a gap. You have four options:
1. Reduce the price to the appraised value. The buyer gets what they need; you get less.
2. Challenge the appraisal. If you have strong comps the appraiser didn't use, your agent can submit a formal reconsideration of value (ROV). Appraisers are sometimes persuaded; sometimes not. Success rate depends on the quality of the alternative comps.
3. Split the difference. The buyer pays the gap in cash (the difference between appraisal and purchase price) out of pocket. This requires the buyer to have the funds and the willingness.
4. Walk away. If the buyer had a financing contingency, a failed appraisal is typically a valid exit point. Both parties can walk with the earnest money returned to the buyer.
In a strong Hampton Roads market with rising values and limited inventory, truly low appraisals are less common — but they do happen, especially on unique properties, fixer-uppers, or in fast-moving submarkets where comps lag actual market prices.
Ready to Make Your Move?
Whether you're buying, selling, or just getting your bearings in this market — I'd love to help. I'm Barry Jenkins, REALTOR® serving Virginia Beach and the greater Hampton Roads area. Let me show you what this market can do for you.
📞 Call or text: 757-919-8874 | 🌐 legacyhometeamlpt.com