Updated September 28, 2026
Nothing changes contractually, and that surprises sellers who assume a high number should mean more money in their pocket. The purchase price in a signed agreement is fixed. A lender's appraisal exists to protect the lender — it confirms the collateral supports the loan amount — not to reopen a negotiation that already closed. A low appraisal can create real leverage for a buyer to push the price down or walk away. A high appraisal creates no symmetrical leverage for the seller to push the price up. That asymmetry feels unfair to sellers the first time they encounter it, but it follows directly from what an appraisal contingency actually protects against.
The purchase agreement you signed sets the price. An appraisal contingency, where one exists, protects the buyer if the appraisal comes in below the contract price — it gives them an out, or leverage to renegotiate down, because their lender won't finance the full amount otherwise. There is no equivalent clause protecting the seller if the appraisal comes in above the contract price, because the seller doesn't need protecting from a good outcome. You already agreed to the number. A buyer who is thrilled to be closing on a building that appraised above what they're paying has no obligation to share that windfall with you.
Your broker priced the building correctly, or conservatively. A number that clears the appraisal with room to spare is evidence the offer you accepted wasn't a lowball — useful information if you were ever second-guessing whether you left money on the table by accepting quickly.
Your buyer has more equity cushion than they might have needed. Their loan-to-value ratio is now more favorable than they expected, which can occasionally translate into a smoother, more flexible buyer through the rest of escrow — but that's a byproduct, not a right you can insist on.
The comparable sales in your submarket are trending up, which is genuinely useful market intelligence heading into your next decision, whether that's this sale or a future one.
If you're selling into a 1031 exchange, a high appraisal on the building you're selling doesn't change your sale proceeds, but it's a real data point when you go pricing the replacement property — evidence that values in your building's category have moved, which your broker can use when evaluating what you're being asked to pay on the buy side. And if you own other similar buildings, a high appraisal on this one is a genuinely useful comparable for how you think about their value, independent of this transaction's fixed price.
Asking the buyer to voluntarily increase the price. This happens occasionally, particularly with a relationship-driven buyer or one who feels strongly about maintaining goodwill, but it is the exception, not something to plan around. Most buyers, understandably, will not volunteer to pay more than the number they successfully negotiated.
Threatening to cancel and re-list. A seller trying to back out of a signed agreement to chase a higher price is in a genuinely riskier position than a buyer who walks away from a deposit — real property is treated as legally unique, which gives the buyer real remedies. A high appraisal, by itself, is rarely a strong enough reason to justify that risk.
Using it as leverage on unresolved deal points. If other items are still being negotiated — a repair credit, a closing date, a contingency extension — a high appraisal can be a reasonable talking point in that broader conversation, even though it doesn't reopen the core price.
Selling any LA multifamily building well means finding the ceiling before you sign, not being pleasantly surprised by it afterward.
If you're routinely finding out only after acceptance that your building would have appraised meaningfully above your asking price, that's feedback about how the offer was solicited, not something to chase after the fact on this deal. Running a genuine marketing process with multiple qualified offers, rather than accepting the first credible number, is what closes the gap between what a building could sell for and what it actually sells for — before you're locked into a contract price a high appraisal can't reopen.
A high appraisal is good news wrapped in a decision that's already been made. It confirms you didn't underprice the building, it hands your buyer a little more breathing room, and it's a useful data point for whatever comes next — but it isn't a lever on the price you already agreed to. The number that matters is the one on the signed contract, and that number was set before the appraiser ever walked the property.
Can I use a high appraisal to justify a higher price on my next building?
Yes — this is where a high appraisal has the most practical value, as evidence of where comparable pricing actually sits in your submarket.
Does the buyer have to tell me the appraisal came in high?
No, and many won't volunteer it. If you want to know, you generally have to ask, and a cooperative buyer will often share it, particularly if the relationship has been a good one.
Could I have priced the building higher if I'd known this in advance?
Possibly — this is exactly why testing the market with multiple offers before accepting the first one matters more than any single appraisal result after the fact.
Michael Sterman is Senior Managing Director Investments at Marcus & Millichap.
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