How Sellers Can Successfully Appeal a Low Appraisal in San Francisco

Author: Ms San Francisco Real Estate | Last Updated: November, 2025

 

A low home appraisal can stop a home sale cold, even after you and a buyer have agreed on a price. This is because lenders rely on appraisals to confirm a property’s value before approving a loan. Therefore, when an appraisal comes in below the sale price, it creates a financing gap. As a result, sellers often face a tough choice. For instance, you may have to renegotiate the price, hope the buyer can pay the difference, or put your home back on the market.

As your trusted San Francisco real estate agent, Ms. San Francisco Real Estate is here to explain the process. In this guide, we’ll cover the common reasons for low appraisals. Additionally, we’ll give you a step-by-step plan to challenge a low valuation and protect your home’s true worth.

 

Why San Francisco Home Appraisals Can Be Tricky

A home appraisal is an expert’s unbiased opinion of a property’s fair market value. Specifically, it is always done by a state-licensed appraiser. Indeed, lenders need this report to make sure they aren’t lending more money than a home is worth.

However, San Francisco has a very active housing market. There is limited inventory, for example, and there are often bidding wars. Because of this, appraisals can sometimes fall behind the fast-changing prices. This is because when prices rise quickly, the most recent sales data might not reflect it. Consequently, an appraisal can undervalue your home, which is understandably frustrating for sellers.

 

Common Reasons for a Low Appraisal in the SF Market

Several factors can cause a disappointing property appraisal in San Francisco:

• Outdated Comparable Sales (Comps): In popular neighborhoods like Pacific Heights or the Mission District, prices change fast. Therefore, using comps from 4-6 months ago can fail to show a home’s current value.
• Overlooked Unique Features: Furthermore, custom renovations, special architectural details, or smart home tech may not be fully counted in a standard report.
• Appraiser’s Lack of Local Expertise: In addition, an appraiser who doesn’t know the details of San Francisco’s unique neighborhoods like Noe Valley or SoMa may choose the wrong comps.
• Market Fluctuations: Finally, a brief market slowdown can make an appraiser too cautious with their valuation.

In short, if you understand these common issues, you will be better prepared to challenge a low appraisal.

 

A 5-Step Guide to Disputing a Low Appraisal

If you receive a low appraisal, don’t lose hope. Instead, follow these strategic steps to ask for a correction.

Step 1: Check the Appraisal Report Carefully for Errors

Your first step is to get a full copy of the appraisal report from the buyer’s lender. Then, go over it with your real estate agent. Look closely for mistakes, such as:

• Incorrect property details.
• Missing home improvements.
• Inaccurate neighborhood data.
• Poorly chosen comparable sales.

Keep in mind, even small mistakes can make a big difference in your home’s final value.

 

Step 2: Gather Your Paperwork to Ask for a New Value

After you find mistakes, it’s time to gather strong proof to support a higher value. Your paperwork should include:

• First, work with your agent to find 3-5 better comparable sales that closed in the last 90 days.
• Next, provide a detailed list of all upgrades, including dates, costs, receipts, and photos.
• Finally, include reports that show rising home values in your neighborhood or ZIP code.

 

Step 3: Submit a Formal Reconsideration of Value (ROV)

Once your proof is organized, your agent can submit a formal request called a Reconsideration of Value (ROV). This asks the appraiser to look at your new information and, hopefully, adjust the home’s value.

When you submit an ROV:

• First and foremost, be professional and stick to the facts.
• Also, write a short cover letter that explains why the first appraisal was flawed.
• In addition, explain why your comps are a better fit than the ones the appraiser used.

Ultimately, a strong ROV with good data often leads to a better outcome.

 

Step 4: Request a Second Appraisal

If the first appraiser won’t change the value, you can then ask the lender for a second appraisal. While they don’t have to agree, they might if you can show clear mistakes in the first report. In this situation, your agent can be very helpful by recommending an appraiser with experience in your specific San Francisco neighborhood.

 

Step 5: Explore Other Ways to Close the Sale

If your appeal doesn’t work out, you still have other options:

• For one, you can negotiate with the buyer. The buyer might agree to pay the difference in cash, or you could both agree to meet in the middle.
• Alternatively, you can find a cash buyer. Since cash offers don’t depend on appraisals, this usually means a faster and more certain sale.
• Of course, if the deal falls through, you can put your home back on the market. Spring is often a great time to sell in San Francisco.
• Lastly, you can consider working with cash offer companies in the Bay Area.

Expert Insight from Ms. San Francisco Real Estate “In my 20+ years in San Francisco real estate, I’ve learned that the best appraisal disputes use data, not drama. Instead, we present a logical case to the lender and appraiser. Ultimately, this makes it easier for them to correct the value. In other words, it’s about showing them what they missed in a professional way.”

How Ms. San Francisco Real Estate Protects Your Investment

Indeed, challenging a low appraisal requires skill and market knowledge. With over two decades of experience, Ms. San Francisco Real Estate has helped many homeowners fix appraisal issues and get the right price for their property.

As the best real estate agent in San Francisco, CA, she provides:

• A close look at appraisal reports to find any errors.
• Expert help preparing all the paperwork for an ROV.
• Professional communication with lenders and appraisers for you.
• Clear guidance on all your options.

Her mission is simple: to protect your investment and sell your home for the highest value it deserves.

 

Frequently Asked Questions (FAQ)

Q: How long does an appraisal appeal (ROV) take?

A: An appraiser usually takes 3 to 5 business days to review an ROV. However, the exact time can change based on the lender and how complex the situation is.

 

Q: Can a seller pay for a second appraisal?

A: A seller can offer to pay. But, the buyer’s lender must still be the one to order the appraisal for it to be valid for the loan.

 

Q: Is a low appraisal common in San Francisco?

A: Yes, in a hot market like San Francisco’s, low appraisals can happen more often. This is because sale prices sometimes move faster than the data on recent sales.

 

Final Thoughts

A low appraisal is a setback, not a dead end. In fact, with a good strategy, solid proof, and an expert on your side, you can confidently challenge the valuation and keep your sale moving forward.

So, whether you are selling or need to appeal a low appraisal, partner with Ms. San Francisco Real Estate. She will work to get your home the value and the sale it truly deserves.