Let’s discuss my favorite mystery in the Real Estate gig……..you guess it “kitty cats”!
So we have four stories to tell….hmm which one first?
The missing square footage?
The Declining market?
The “you can’t build it for that price?”
Or the EXPIRED license!!!!
A series, we’ll start with my favorite “the declining market”
As I have mentioned several times Mee-Am-Mi is a BIG @#$%^& place and what is declining in one place does not mean it’s declining in another.
Sold a home, went to the appraisal and literally handed the appraiser a previous appraisal indicating value at the current sale price.
The dude thanked me and promptly proceeded to value the property 36k under sale price.
WTF, why the difference?
Declining value in the neighborhood……Really?
Me; “So where do you live Ace?”
Ace; “Kendall”
Me; “Ever try to buy a place in the Grove”
Ace; “No, I can’t afford it”
Me; “So what makes you think this market is declining?”
Ace; “I have a license and I read it somewhere?”
Me; “How much to you get paid?”
Ace; “Huh?”
Official verbiage from appraisal explaining something; HUH stuff in Bold……
• Market Conditions Addendum to the Appraisal Report : Foreclosure/REO Sales in the Market
The appraiser has reviewed closed sales over the last 12 months, as well as, current available listings from within the subject’s market area. The analysis indicated approximately 63 closed sales over the past 12 months. Only 5 were found to be REO/foreclosure sales, which equates to approximately 8% of all sales. There are currently 87 active listings in the subject’s
market area.
1 was found to be REO/foreclosure listings. This equates to approximately 1% of all listings. Thus, REO/foreclosure activity is not considered prevalent at this time. As such, no REO/foreclosure sales or listings were included in this appraisal.
Now wait for it…………………………..
However, the presence of these types of transactions do appear to be placing additional downward pressure on sales prices, as well as increasing typical marketing times.
And there is my ah ha moment…it’s a declining market because of something that has not happened yet!
End of story, you ask?
Nah.
The Buyer realizing that the appraiser was clueless, paid what the “As built” price was which was much higher then the appraised price.
Why you may ask?
Cause they don’t live in Kendall, They have been shopping for over 6 months and they REALLY know what is declining and what is not.
Which leads me to “As Built”……..to be continued.