Pamela Crowley (Florida)
Elite Member
- Joined
- Jan 13, 2002
- Professional Status
- Retired Appraiser
- State
- Florida
What do you all think about this article?
http://www.ajc.com/homefinder/content/homefinder/stories/2008/01/10/johnadams_0113.html
Wait-and-see attitudes contribute to appraisal volatility
http://www.ajc.com/homefinder/content/homefinder/stories/2008/01/10/johnadams_0113.html
Wait-and-see attitudes contribute to appraisal volatility
I found out years ago that the most popular of all small talk is about real estate home values. "What's it worth?" must be the most often asked question in the world of real estate. And anyone venturing a guess, based on almost any data, or even none at all, is instantly the center of attention in any discussion.
Unfortunately, there is one problem with all this speculation: one can never know exactly what one's home is worth until it is placed on the market, given a full exposure, and finally, been placed under a negotiated sales contract by typically motivated parties. In other words, you can't know what your home is worth until after you sell it.
But if that is the case, then why are we so preoccupied with guessing, and how do the appraisers come up with their prices for fair market value?
Is it possible that we are today seeing a concentration in the pool of buyers, skewing it toward those who are not typically motivated, but instead are looking for great buys from desperate sellers who must sell at any price? If that is the case, it would explain a lot.
With current levels of foreclosures, there are many sellers who are highly motivated to sell their homes, if for no other reason than to stop the foreclosure.
My point is this: Until we see a healthy level of sales re-established in the metro home market, we may see an unusual level of volatility in reported home values. That makes the appraiser's job particularly difficult, and brings into sharp focus the challenges facing the real estate market today.