The whole nation has been talking about the Calgary flood ever since they swept out a large portion of that city at the end of June. And while we’ve talked here about how home sales have been booming in Calgary ever since, there’s another phenomenon happening here, too. Lenders are demanding re-appraisals on properties that they’ve already approved.
Skye McLean, a mortgage broker in the city, says that lenders are asking for re-appraisals on any property affected by the floods. And that deals on those properties are now waiting up to five days to close.
“We are about one week out on appraisals here,” she says. “A lot of the lenders are asking for appraisals and re-appraisals of properties affected by the flooding. And they are asking for full appraisals. That has slowed things down considerably.”
Not every lender is asking for a re-appraisal on every property though. The government’s own bank in the province is still putting through any mortgages that were in process when the flood hit; and ATB Financian executive vice-president, Rob Bennett, told reporters,
“We have not held back funding on any specific deals that we had committed to, and we have not required new appraisals on those files.”
One bank that has though is TD, who has ordered re-appraisals on every home hit by the flood that they had already started working on a mortgage for. And not just new mortgages, but refinancing deals too.
In total there are 947 properties in Calgary that were affected by the flood, and 58 homes in High River. While all may not require re-appraisals, there’s a good chance that many of them will. Scotiabank says that while they will ask for re-appraisals on an individual basis (meaning not all properties will be asked to get one,) any that are done will be done “at the bank’s expense.”
The banks of course, would like re-appraisals done because they need to know the full value of a house as it stands now – even if the purchase was agreed on in the middle of June. And while that may not be good news for homeowners or home buyers, it’s great news for appraisers in the area.
“They are keeping very busy!” says McLean.
And that’s true enough. One Calgary appraiser reported that they were asked to check 50 homes that were all damaged by the flood; and there’s a good chance that they weren’t the only one with a full schedule after the flood.
