Ron Patton
Sophomore Member
- Joined
- Sep 5, 2004
- Professional Status
- Certified Residential Appraiser
- State
- Tennessee
Appraisers Migrating to East Tennessee
A little insight for those out-of-state appraisers who think East Tennessee is the land of milk and honey. In the Chattanooga area in the past 12 months, we have had approximately 2 new multi-million dollar subdivisions foreclosed on. Most recently, a guy who wrote a check for several million dollars 5-6 years ago to UT-Chattanooga to pay off debt just lost a 200-lot S/D on which he owed a local bank $6.5 million; next door to him, a second small bank is currently fighting in bankruptcy court over a $3 million loan on a 90 percent complete S/D where the developer has run out of money. Both of these are in the highest growth section of the county! A mile +/- from these 2 S/D's, several builders have been selling homes at--or below--cost over the past 3-4 months in a third new S/D; 80-90 new homes in the $225-275K range. Hardly nothing selling. The past 3-4 I have done in the S/D have fallen 15-25K below Marshall and Swift in Cost. (I'm in my 18th year, and I know what I am doing). The major lenders in our market have gone to rotation panels, and if you haven't been in the market at least 10 years, don't bother calling on them. Personally, it's great. The loan officers are no longer permitted to communicate with the appraiser! It's a whole new day. There's probably 25 local appraisers ahead of you giving their best to crack the major lenders. Skippies? Who are they going to work for? The small mortgage companies are almost all gone! And the state has finally started dealing with them. One other item of interest: we had 1,500 foreclosures in our market last year. The numbers are increasing this year. I have been on my own 12 years and have work, but major lender clients are telling me that things have slowed. For those not familiar, interest rates are moving up as the bond markets have gotten really nervous over Fannie/Freddie. And underwriting seems to get more stringent weekly. Local MLS data relesed last week showed an 18% year-over-year drop in median sales value, and a substantial drop in the number of sales. Knoxville may be great, but Chattanooga has a long, long way to go. We will be back with a VW plant secured in recent days, but it ain't gonna happen overnight. Inventory/absorption is 2-years plus. Local board of realtors has lost approximately 30 percent of its membership. How much more do you want. By the way, I still see the glass as half full. I moved my office to my home 3 years ago; my home is paid for; my autos are paid for; my son graduated from college in the Spring; I owe nothing. I will survive. I am not so sure about any aspiring newcomers who are fleeing down markets. Good luck to all those poor souls. Personally, I suggest you consider an alternate career . . .
A little insight for those out-of-state appraisers who think East Tennessee is the land of milk and honey. In the Chattanooga area in the past 12 months, we have had approximately 2 new multi-million dollar subdivisions foreclosed on. Most recently, a guy who wrote a check for several million dollars 5-6 years ago to UT-Chattanooga to pay off debt just lost a 200-lot S/D on which he owed a local bank $6.5 million; next door to him, a second small bank is currently fighting in bankruptcy court over a $3 million loan on a 90 percent complete S/D where the developer has run out of money. Both of these are in the highest growth section of the county! A mile +/- from these 2 S/D's, several builders have been selling homes at--or below--cost over the past 3-4 months in a third new S/D; 80-90 new homes in the $225-275K range. Hardly nothing selling. The past 3-4 I have done in the S/D have fallen 15-25K below Marshall and Swift in Cost. (I'm in my 18th year, and I know what I am doing). The major lenders in our market have gone to rotation panels, and if you haven't been in the market at least 10 years, don't bother calling on them. Personally, it's great. The loan officers are no longer permitted to communicate with the appraiser! It's a whole new day. There's probably 25 local appraisers ahead of you giving their best to crack the major lenders. Skippies? Who are they going to work for? The small mortgage companies are almost all gone! And the state has finally started dealing with them. One other item of interest: we had 1,500 foreclosures in our market last year. The numbers are increasing this year. I have been on my own 12 years and have work, but major lender clients are telling me that things have slowed. For those not familiar, interest rates are moving up as the bond markets have gotten really nervous over Fannie/Freddie. And underwriting seems to get more stringent weekly. Local MLS data relesed last week showed an 18% year-over-year drop in median sales value, and a substantial drop in the number of sales. Knoxville may be great, but Chattanooga has a long, long way to go. We will be back with a VW plant secured in recent days, but it ain't gonna happen overnight. Inventory/absorption is 2-years plus. Local board of realtors has lost approximately 30 percent of its membership. How much more do you want. By the way, I still see the glass as half full. I moved my office to my home 3 years ago; my home is paid for; my autos are paid for; my son graduated from college in the Spring; I owe nothing. I will survive. I am not so sure about any aspiring newcomers who are fleeing down markets. Good luck to all those poor souls. Personally, I suggest you consider an alternate career . . .
