I know Carmen had an issue selling his home near Cleveland, due to the price of the "comps" or lack thereof. Deb just had an issue on the value of her condo as well, I believe.

I noticed a for sale sign on a house around the corner from me. Most of the homes are three bedroom ranch style or Cape Cod style homes. Most are also on rather small lots; your basic starter home.

They are asking 209K for this house. Just a few years ago, these little starter homes were going for the 275K range. I know values have dropped, but I would not have expected this much of a drop. This particular home is not all that well kept. I doubt much has been done to modernize it.

We've remodeled our kitchen and bath, have hardwood floors and tile throughout, central AC, the nice new deck made of composite material and a well maintained yard.

We are not moving anywhere, but seeing a house in the neighborhood at that price makes me , as to what that would do to the comps, should we decide we want a morgtage, home equity loan, etc. Not much else has changed hands in the neighborhood for quite some time.

Just curious.....

 

Welcome to the real world. A 24% drop does not seem out of line from others I've heard of.

 

Here's a couple quick "average" numbers. "The second quarter year-over-year decline was 14.7%. Prices had dropped 19% year-over-year during the first quarter of 2009." Some locals are inching up while others . . . not so good.

 

Lack of valid comps and the whole appraisal process is a very touchy issue right now. First, there are very few comps. Second, the comps that are out there often have a 'story' - stretched seller/short sale/non-arms length/etc. Third, appraiser are under heavy pressure from lenders to be conservative. Mix it all up and you have a valuation process that is difficult at best. Its even tougher on the commercial side, where its becoming common for the lender to go back to the building owner and demand they put in more equity to compensate for the loss in market value and help get the building's debt to equity ratio back in line. Tough tough tough and I don't see it getting better any time soon.

 

Yep, it makes a mess out of refinancing/selling. As I mentioned last Mar when I refinanced, I was fortunate because I was only refinancing my original loan, which was about half of what the lowball appraisal came back as. But I would have been really, really upset if I had been trying to sell. There were no comps and still aren't. I'm happy we are staying put for the foreseeable future.

 

We aren't going anywhere either. I do watch the local real estate transactions in our town each week. As I said, we've not had any sales in our neighborhood for quite some time. The transactions that have taken place in town seem reasonably priced, no huge decrease in property values. I wonder if the sale price of this house is simply a reflection of the fact that it may be a "fixer upper."

I hope the values rise by the time we need a reverse mortgage.

 

Several months ago, we had several houses in the area listed for sale in the mid-600's . They took about 6 months to sell but they were selling at about 10% below list price.

About two months ago, one of our neighbors started divorce proceedings and short sold their house for something in the 400's. Real estate prices dropped from the 600's to the 400's almost overnight. It was a real eye opener as prices in my Scottsdale neighborhood had all ready dropped from the mid-700s due to the collapse of the housing market since 2007.

 

I've been watching out for vacant lots I might buy to build a big garage or barn on. There are some down the Cape for well under $100K. I need to talk to the building inspector to find out what I can get away with in a residential neighborhood. I have a feeling they won't be too pleased with a 1500 square foot garage and no house or living space. I'll probably have to put a small apartment on the second floor of the thing.

 

Wow...I'm amazed you can find a vacant lot there. So what are you going to put in that garage/barn?

 

Up here home prices are up 3% Maine its happening here