Q: Home under appraised by 25k. Is the listing agent at any fault?

A: The fact that you had an offer three days later at full price is evidence that the appraiser, not the realtor, is wrong. The problem is that so many fraudulent price-fixing offers occurred in both the real estate banking crisis around 1989 and – quite a bit more severely -- in 2008 that the law added all sorts of independence and distance in appraisal standards. But, "market value" is determined by how the market values the property, and in quick upswings, which we seem to be experiencing in the local Washington SMSA, the appraisers will be behind the curve. It is difficult to suggest that your realtor committed malpractice by getting you an offer that was $25,000 above what some appraiser calls the market value, but lenders (and investors, bond holders, and guarantors of those lenders) aren't going to do an investigation with each loan to determine whether your offer is a fraud intended to inflate the assessed market value in the neighborhood.

There might be a negotiated resolution by getting the appraiser to reconsider; by having the realtor sit down with the appraiser (if the appraiser will allow it) to explain the realtor's Competitive Market Analysis (which is pretty much exactly the same thing as an appraisal without the certification); or by giving the buyer time to find a new lender or putting the house back on the market. Indeed, it might have been wise to meet with the appraiser when he wanted access to the house and "coach" him a bit on the comps. But, as of now, it's a dynamic game, and my first choice in the game would not be walking away from a full price offer obtained three days after the listing or selling your car.

A: A public post on this site is not designed to give any legal advice or opinion specific to a situation, but just general information related to a topic of law.

Let me first clarify /re-state your question: you asked a real estate agent to do what you wanted by listing at a certain price, now you wonder if there is legal basis to hold her "at fault" for following your instructions because a third party (appraiser) later had a different opinion of value?

Generally speaking, NO, an owner/principal has no legal basis for challenging their agent's decision to follow the principal's instructions.

An agent is not an appraiser and cannot realistically guarantee what an appraisal comes in at. An agent can give an opinion on market value, and an offer at or near the agent's opinion would seem to validate the agent's perspective.

Neither the Buyer nor the Seller nor the Agents for them have any control over the appraiser's view of value. It is not usually anyone's "fault." The appraiser is hired by the buyer's bank to make sure there is enough value to protect the bank's interest. After the housing crisis of a few years ago it is not at all unusual for an appraiser to err on the low side, and it happens sometimes that the appraiser comes in far lower than what everyone else thinks is a reasonable value. The borrower could perhaps ask for a second appraisal, but it would seem very unproductive to look for someone to blame.

Again, this post does not attempt to offer legal advice but general information.