So the appraisal came back and it was quite lower than the total cost of the project. First, the land was valued significantly lower than our agreed upon price. Second, the construction was also valued lower than our agreed upon price with the builder. This comes as no surprise as the market is in the tank and all the appraisers have to compare this to is other newer colonials in the area that have been selling for rock bottom prices. Construction costs (labor and materials) don't really change or get lower so this situation is pretty understandable in our eyes.
Our builder asked around to other contractor friends who have been trying to get projects underway and they have been giving him the same feedback: new homes aren't appraising anymore and people are not able to build the new homes that they wanted to because the bank isn't able to lend them the money due to the appraisal.
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