Re: Misrepresentation

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Your big mistake was relying on an appraiser in a multi-unit
investment. The way properties are valued in those
circumstances are based on net rents and application of
a "capitalization rate". A different Capitalization Rate
applied to the same net rents will produce a different
value. So the first issue would be, what Capitalization rate
was applied to the net rents in the differing market
analysis. The next issue would be, what variables and methods
did each appraiser use to determine net rent and vacancy rate.
And finally, did all the rehab work do anything to increase
rents or reduce monthly expenses? If it didn't, there is no
reason for it to increase the value.

Change the Cap Rate, and the "value" can swing $100,000
instantly. And rehab work may be necessary, but it isn't
always profitable.

So assuming the sellers gave you or made available all the
information needed, and you (or your appraiser, or your
Accountant) misused that information in calculating value,
its not really a misrepresentation case against the seller.
It may be a negligence case against your accountant depending
on what you asked him/her to do.