Appraisal On Pre-Construction Condo Leaves Buyer Out Of Luck

In Palm Beach Gardens, Florida, The Palm Beach Post reports:

• Two years ago, Angie Cifarelli of New Jersey signed a pre-construction contract to buy a condo at the Residences at Midtown in Palm Beach Gardens. Purchase price in the contract: $404,500. Last month's appraised value of the newly completed condo: $200,000. "I was shocked," Cifarelli said.

• A property worth less than half its value in 2006 is all you need to know about how bad the real estate market is these days. But this 50 percent drop is not just academic for Cifarelli, who wanted the Midtown condo as her vacation home. With the rock-bottom appraisal, she says she can't get a mortgage for $283,000, as planned. And she says she certainly can't go into her pocket for the balance. Cifarelli says she asked the developer either to drop the price or to let her out of the deal and give back her $80,000 deposit.

• Ram Development's response: No, thanks. Ram told Cifarelli she signed a contract for a cash deal that was not contingent on mortgage financing. The fact that the property fell in value is, well, Cifarelli's problem.

Reportedly, Cifarelli's lawyer is looking at the possibility of voiding the deal and recovering the deposit by reason of possible violations of the Interstate Land Sales Full Disclosure Act. For more, see Appraisal on condo puts buyer in pinch.

Go here for other stories on real estate speculators and others looking to back out of purchase contracts. zebra