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Comment by mech987 | Hacker News Reader

If the city can buy property at 90% of appraised value, they can sell to the market at true market value. As long as their appraised value is accurate, they profit from this arrangement.

It provides the proper incentive to align appraisals with market value and prevents the city from exploiting its citizens.

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I think you're missing the point - that system invites corruption of the appraiser. There's a nice kickback in it for someone who artificially inflates the appraisal of a worthless property and, forcing the city to buy it from the owner who is in cahoots with the appraiser. Leaving the citizens holding the bag of course.

That will become apparent as soon as the city is stuck holding a property it can't sell back to the open market and the appraiser will quickly find himself audited.

Why wouldn't a city use an independent appraiser to vet those numbers?

It’s an interesting idea, a few loopholes come to mind:

If the option to sell is at anytime through the year, there is the risk of city being on the hook when values tank across the board. If the exercise window is only say a month after the appraisal this risk is diminished.

I could see this system being used to exploit uneducated homeowners and essentially con them into selling below market value. Not sure how to lower the risk of this one happening.

1. I would expect the window would be the same as you have now to contest the value. Ideally nobody would exercise this right since it is essentially an SLA for government assessment quality. Everyone would rather have an assessment be consistent and slightly conservative than arbitrary and inflated.

2. I don't see the exploit? If they sell below market value then the government gets the profit.

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