I don’t claim to be an expert on this, but I thought that the furniture was not normally included when the model is sold. It was put there by some company that decorates model homes for a living then it gets moved to the next model when no longer needed. I think the added value in model homes is that you get all the upgrade options like slate granite, hardwood floors, better molding, better carpeting, etc.- the things they can’t really take out and that are properly included in a calculation of the value of the home.

Personal property must be deducted from the “selling” price, to reach the true purchase price.
Lenders don’t lend on personal property.
Purchase loans are based on appraised value, with a max of the purchase price.

In above example, if the appraisal was $900K you would need financing based on $900,000K. You would have to pay $100,000 separately for the personal property, and may have to pay sales tax on top of that!
(If appraisal was higher than $900K, you could juggle)

On a purchase, the appraiser will review the purchase contract.

No lender “requires” 80% LTV. Depending on doc type, credit score and reserves, 100% financing is still possible.

IF the home appraised for $1M, the personal property could be included, HOWEVER it should not be listed on the purchase contract.

Property tax should be based on the value of the home.
(not the personal property)

Also, when buyers ask for a seller concession for closing costs etc, as long as the property appraises at the higher amount, lenders will accept a max of 3% or 6% depending on the loan program. That will result in a higher selling price, and property taxes will be based on the total purchase price, as the property did appraise for that.

The lender would base LTV off of the value of the appraisal. Appraisers are not in the business of valuing furniture. So I am pretty sure the appriaser would value the home at 1M if that was the agreed upon price. A lender would not accept an appraisal if it said the house is worth 900K and the furniture 100K.

The appraiser wouldn’t value the home at $1M JUST BECAUSE that was the agreed upon price.
You are correct that they don’t value the furniture.

Buyers have no idea what the property is really worth today. There are cases where an offer is made, but the property doesn’t appraise for the “agreed upon price”
Unless buyer comes in with cash, it’s a dead deal.

On a purchase,lenders lend based on lower of appraised value or purchase price.

On a refi, they will lend on appraised value, (even if higher than purchase price)
There are lenders that will consider a cash out refi one day after closing on a purchase loan.

I’d say an appraiser “shouldn’t” not “wouldn’t”

An appraisal is only the opinion of the appraiser, but in the case of a tract home, regardless of price, it’s pretty hard to justify a 10% swing.

With custom homes and unusual parcels there is a bit more flexibility of opinion.

Most appraisers will not risk their license for an appraisal fee of a few hundred dollars.
A lender can and usually does appraisal reviews, esp at that level.

Any intelligent appraiser WOULDN’T push the value of a $900K home to cover $100K of personal property.