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Declining Market

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Restrain

Thread Starter
Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
It's been 7 months since 9/11 and the accompanying acceleration of the recession. Now, I'm starting to get some requests for reappraisals of properties I did a year ago, prior to 9/11 and I'm having to tell the clients that values have declined, in some cases significantly. Marketing times are significantly increased from what they were prior to 9/11. Builders who were selling custom homes in the $470,000 range are now taking $435-440 for the same home with the same amenities.

The only question now is how long this is going to last. I'm not worried about work, because I'm getting more foreclosures.
 

David S. Roberson

Senior Member
Gold Supporting Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Same thing here. I did one at ###Street on 02/13/2001, market indicated $105,000. I did the same house yesterday (04/29/2002) and market indicated $90,000. A combination of recent recession AND local market correction after runaway appreciation in the late 90's.
 

Paul Ness MAI

Member
Joined
Jan 14, 2002
Professional Status
Certified General Appraiser
State
Pennsylvania
That's not the situation everywhere. Where are you located? In my neck of the woods (central PA) home sales are hitting record levels every month and average prices are increasing. In a nearby market, a suburb of Phili, sellers are getting multiple offers and selling homes for more than list price in some cases.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Jacksonville, Florida metropolitan area: it depends on the subdivision or immediate market area. I'm seeing a little bit of each direction but the majority are stable - no recent rises, a few declining and a few still pushed. I call the pushed ones the Realtor/Builder Circus Projects. Maybe they will continue to hang on. :?:

I think my crystal ball is badly broken.
 
Joined
Jan 16, 2002
This area is still in deep denial of reality. Realtors and builders are still
acting as though market is soaring at 30% appreciation and boosting listings by another 20% without and sold properties to justify this. When data is checked (active listings, acceptances, contracts, and sold) it paints the opposite picture that they are. Inventory is up, days on market is up, and so-called "volume" by Realtors dosn't exist. Prior 9/11 volume
(i.e. number of properties sold) is +25% higher than post 9/11 volume.
Stopped doing time adjustments a long time ago. Market is so skewed there is no logic in it at all. Identical homes are being listed with +20% differentials. Buyers and deals are dropping like flies. Looks like the
appraisers to make all the deal are even lost for a gimmick to make the high numbers work. It's a house of cards and it's coming down.

Saw this same behavior in the last go around in the late 80's. Most won't be worth the mortgage amount. In lower Manhattan (near ground zero)rents have dropped by 50% with 2 months free rent offered as an incentive.
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
All I see happening here in whitehair heartland is the really high end stuff sits around a tad longer, and the mid-high range stuff is (like Joes market) up for substitution or negotiation if the buyer has any brains.

Most buyers have no brains.
Most local appraisers hit the number.

New construction mid high range seems to be plugging along on the residual move in or move up demand, but I notice a lot less starts by the guys who have been doing bidness for a long time.

That 20% discrepancy in resale (all other factors seeming the same) listings seems pretty germaine to our area also, but in this area it has always been realtor driven, certain ones promise (and surprisingly deliver) the moon.
 
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