Paul's Appraisal Blog

     I recently appraised a beautiful home in Carlsbad that had a value of approximately $1,750,000. As I analyzed the home values for the last 2 years, I found they the rate of decrease in value was much smaller than that of lower valued homes.  Over the last two years, the homes in this area lost about 10% or so, while homes in low-valued areas of, say, Oceanside, lost about 25%-30% over the same period.

    I researched other areas and found the same trends. Higher valued homes tended to hold value much better than lower valued homes. One can speculate that this is the case because at the peak of the market, when homes were probably over-valued, people could only get in to the lowest priced homes with risky, adjustable-rate loans and little to now documentation of income. One the other side of the coin, people who can afford the higher-end homes tend to be a bit more knowledgeable about finances and can more easily document income and get traditional 30 year fixed products.

    When the adjustment came, the market was flooded with lower priced homes in foreclosure while the upper end homes remained unscathed.

    Anyway, I'm just writing this in case you're wondering what YOUR home value is doing. If you're in a high-end area, you're in pretty good shape. If not, then you're probably seen a substantial drop in your equity.

    If you have any questions or comments, feel free to drop me line at paulmcewen@cox.net and I'll get back to you right away. Thanks!!! 

    Are you feeling squeezed lately?  Finding it a little hard to make ends meet? You're not alone, my friend. This economic downturn is of historical proportions and has caught many a good citizen by surprise.    

    I, myself, had been thinking that I was the only one having a hard time. My colleges appeared to be doing well with no outward signs of hardship. However, after talking with them a little more in depth, it turns out most everyone has had to tighten their belt and hunker down for the duration.    

    Although these are scary times, we can all bring away something from this. Personally, this situation has gotten me to keep tighter track of my money- I'm actually bugeting, which money managers have been urging people to do forever. I'm diversifying and trying to bring in different sorts of business. I'm networking more and taking classes to increase my knowledge and skill base. (Now that I have more time on my hands!) I'm living within my means and paying down my debts.

        I think we will be in this mess for a couple of years. For some reason I think 2010 will be the turning point- it's just an intuitive hunch. Although real estate and the stock market have taken big hits, in the long run, this is where to put money. I read somewhere that there have been 31 recessions since the turn of the century, along with 31 recoveries. There is no reason to believe this will be any different.

    Stay strong, think positively, and do the best you can. This, too, shall pass. I firmly believe that if we learn the lessons this has taught us, we will be stronger for it.

    Have a comment? Shoot me a line. Thanks for visiting my site.

    I did an appraisal the other day in Riverside county. It was a purchase and the buyer was there to deliver the check and make sure everything was ok. It was a nice house and he told me that he actually got in a little bidding war over it. He won, obviously, but at a slightly higher than asking price. It was on the market all of 4 days. When I pulled comparable sales to use in the report, they were all in a very tight range of values with market times of under 3 months.

    Bidding wars? Market times under 3 months? Hmmm... sounds like the old days before the real estate downturn. I think, my friends, that we are at, or very close to, the bottom. Prices are so low that people can't resist buying- but they are also low enough so that people can buy them. Housing is affordable again!!!

    If the credit market can be kept viable, I think home prices will stabilize very soon. If you are in the market for a house, I think now is the time. Once all of these foreclosure properties get mopped up, that's it!

    What do you think? If you'd like to talk, go ahead and shoot me an email at paulmcewen@cox.net . I always enjoy hearing from any readers out there. Thanks for visiting my site and reading my blog!!