Real estate appraisals for divorce, estate settlement, loans, property tax appeal, pre-listing and more. We cover Sacramento, Placer, Yolo and El Dorado County. We're professional, courteous and timely.

I met up with Realtor Steve Ostrom today to talk about what’s been happening in the Sacramento real estate market. Steve focuses on Roseville and Rocklin, but he also lists properties all over Sacramento. He sits on the Board of Directors at the California Association of Realtors and he really knows his stuff. Steve and I talked about inventory levels, multiple offers, distressed sales, flippers and more. The main question was, “What’s happening in the real estate market?” Watch or listen to our conversation below (or here) to get a glimpse of how the market has felt lately in the Sacramento area.

What do you think? Have you seen something similar? Why do you think inventory has been down?

By the way, this video marks the debut of my beardless look for 2012. I suppose it’s a resolution of sorts, but I decided it was time for my “distinguished” beard color to go away – at least for this year. Since shaving the gray, not one person has said, “Ryan, you really shouldn’t have done that,” so I know it was the right season to let the razor win. I know you don’t come here to hear about my face, but I just wanted to put this out there publicly so there is some internet accountability in case you see a beard creep back into my life this year.  Anyone make a similar resolution?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

When an estate has a transfer of ownership due to death or inheritance, a home owner will need to eventually hire a real estate appraiser in order to show the IRS what the reasonable worth of the estate is. So the owner or heir will obtain a “Date of Death” appraisal, which is an appraised value as of the date of the death of the deceased owner.  These appraisals are very commonly ordered within several months of the death of a loved one, but there are three things to consider before ordering the appraisal:

1) Timeline: If your loved one passed away recently and you need to file your taxes very soon, it makes good sense to obtain an appraisal in a timely manner so you can communicate well with the IRS. In other words, if your loved one passed away within six months before you file your taxes, it would likely be prudent to order the “Date of Death” (DOD) appraisal within that timeframe. This is the most common scenario I encounter for the bulk of my estate appraisal workload.

2) Alternative Valuation Date: I mentioned the Date of Death (DOD) appraisal already, but the IRS has also made allowances for a home owner to obtain an Alternative Valuation Date (AVD) six months after the date of death of the owner. Basically, if the market has declined in value after six months since the date of death, you can use the appraised value six months later to show your estate has decreased in value over time due to market circumstances. In this option you would need two appraisals, both a DOD and AVD. If the market has been hit hard, this could be a huge advantage for you for tax purposes. Granted, you would pay for two appraisals (use the same appaiser), but the savings in light of a large decline should far outweigh the cost of the appraisals.

3) CPA / Attorney Advice: Make sure to carefully weigh your options and the implications of using a DOD or AVD appraisal. You should definitely consult with your CPA and/or attorney to talk through which options would be most beneficial for you depending on your plans for the property and the implications for taxation based on using a DOD or AVD.

I am familiar with the estate planning appraisal process, IRS guidelines for appraisals, and I also run an estate appraisal website. Please contact me with any questions. I am always very glad to help answer questions and meet a need for property owners in what is often a difficult time of life.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I wanted to help clarify why you should NOT pay someone to appeal your property taxes (including me) during the first two quarters of any given year in the Sacramento area. I am only talking about typical “decline in value” situations where the real estate market has gone down, yet your property taxes still look too high compared to the true value of your home. NOTE: There are other non “decline-in-value” property tax scenarios that can be addressed year round.

Two reasons to AVOID paying someone to reduce your property taxes before July:

1) Assessments are Published in June or July: The Assessor historically doesn’t publish their assessed values until the second quarter of 2012. Every year tax companies send mailers in the early part of the year promising to reduce property taxes, but how can they offer to reduce your property taxes in February or March if they don’t even know your assessed value? Moreover, the Assessor does actually review property taxes and they might catch your overassessed value and correct that before their assessments are posted. Again, why pay someone if the Assessor could potentially get it right anyway? Ultimately a company can easily claim they “helped” you when in fact the Assessor simply got your value right and would have adjusted it regardless of the “help” you received.

2) The Appeals Period is July to November: The formal period to dispute your property taxes is between July 2 to November 30 of any given year for most counties surrounding Sacramento (besides Placer, which is July 2 to mid-September). Why hire a company in March when the company cannot formally dispute your taxes until July? First see what the Assessor says your property is worth and then make a decision about whether to appeal or not once you see your property’s value. The value should be based on January 1, by the way.

Here is a video with the same information above if you wish to listen instead:

I know a post like this sounds very self-serving since I run a property tax appeal company, but this is truly about honest business and providing good tips to save money. I sincerely want property owners to not be taken advantage of as I mentioned above.

What should you do? The best case scenario is for you to wait to see how the Assessor values your property for 2012. If the value looks too high come June or July 2012, and you don’t know how to provide support to show a realistic value, then hire a reputable company to handle it for you. If you want an email reminder when property assessments in Sacramento County are released, click here to fill out the form on the sidebar and I’ll send you an email reminder so you can remember to check your property taxes come July 2012.

Was that helpful? I hope so.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Would it bother you to live next to a high voltage tower? I snapped these photos recently while in a neighborhood in the Sacramento area. You can see these towers are very close to the houses (within 100 feet easily in some cases). While someone selling the property might be tempted to say the house “backs to open space”, the view is clearly obstructed and dominated by the presence of the tower, so any “open space” premium is likely watered-down a bit, right? In appraisal terminology, we’re dealing with external obsolescence, which is a reduction in value caused by an undesirable factor outside the property.

How have you seen buyers respond to a location near a power tower? What do you think is the main turn-off in the minds of buyers? Visual pollution or a potential for health risks due to electromagnetic fields?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Having an open window is not an option in situations like this unless you want to get famous on YouTube as the “showering neighbor”. I’ve talked before about “fenestration“, which is a fancy word meaning the design and placement of windows (and other openings) in a building. While it’s nice to have so much light in a bathroom, it always amazes me to have views like this. Whether taking a shower or brushing teeth, mostly everyone would want a bit more privacy, right? This house also has windows in the Master Bedroom and at the bottom of the staircase with direct views into neighboring houses.

What do you think of the view?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Sometimes there really isn’t any value in a house. I’m working on an appraisal right now where the cost to demolish the house looks to be the only ”value” the structure is bringing to the lot. When a house has very poor workmanship, a shoddy foundation, does not conform to current code in any sense and is all around sub-par in quality and construction, it’s not too likely to be a positive contributor for value.

Improved Site – Cost to Demo = Market Value

In a valuation like this I would not just consider the raw land, but also the contribution of value for any other improvements too – namely water and sewer on the site (hence the term “improved site”). But the cost to demolish the property also must be considered in a case like this because a buyer in his right mind wouldn’t pay money for an inhabitable house that is well beyond a reasonable cost-to-cure.

The moral of the story? Just because a house exists does not mean it has value. In so many cases a house can be salvaged, but in some cases a house just needs to meet a bulldozer instead.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Did you try to get a loan or sell a property but had appraisal problems? I hear all the time from real estate agents, home owners and investors about bad appraisals that killed their deals. What can you do about a “low” appraisal? Honestly, not much sometimes, but you can at least write a well-reasoned cordial letter to the lender to ask the appraiser to reconsider the value in the report based on support you offer in a brief letter. I’ve seen some clients have success with the points I explain in the video below when they legitimately do have a “low” appraisal. When I say “low” too, I’m not talking about a value that is lower than the sales price because we all know market value and price are not the same thing. I really have in mind an appraisal that is truly botched and plain bad. By the way, you can read a blog post about challenging low appraisals in case the video is not working for you.

I’d like to hear about your situation with a “low” appraisal and what you did about it. How did the appraisal impact your deal?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I’ve driven by this banner twice in the past week while on appraisal inspections in the City of Lincoln. Isn’t it a sign of the times for builders to offer concessions like this to buyers? During the boom years before the market tanked there were no concessions as such because it was a seller’s market and builders did not have to create incentives like this to attract buyers. In fact, builders in those days tended to charge very high amounts for “premium” upgrades too, whereas now these same upgrades such as granite countertops and stainless steel appliances tend to show up in standard models. Since today’s market is more of a buyer’s market,  sellers need to price their properties appropriately and in some cases offer incentives like this to attract homebuyers.

If you’re in real estate, how have you seen concessions in a purchase price impact the market? Do you see a difference in price level between conventional offers asking for no concessions and FHA offers asking for 3% back? Which tends to be higher? If there is a difference, what does that tell us? Lastly, do you think the HOA fees above are really free or is the price inflated to cover the cost of the fees?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

If you know anything about FHA loans,  you know a defective paint surface is something that needs to be cured. If the exterior of a house has chipping, peeling or flaking paint, it can be a health and safety issue if the house was built before 1978 due to a potential for lead-base paint exposure. If you didn’t know, FHA has an exhilarating 51-page manual for how to properly cure a defective paint surface (PDF). This is just the type of ready you love to do, right?

DO NOT LEAVE PAINT CHIPS ON THE GROUND: If you’re dealing with a defective paint surface, make sure you or your contractor scrape away any defective paint and then completely reseal the surface with new paint (or some sort of HUD-approved sealant). Moreover, DO NOT leave paint chips or any defective paint dust or residue on the soil. This might seem like a minor point, but you don’t want to have to deal with potential environmental consequences for lead-base paint touching the soil, right? The appraiser cannot verify the paint problem was taken care of if there are paint chips all over the place on the soil.

This is why I include something like the following in my lender reports:

The appraiser noted a defective paint surface on the southern portion of the house near the roofline. All this portion of defective paint should be properly scraped and there should be no bare wood after scraping. The surface should be repainted or sealed according to FHA standards. As always, there should be no paint chips or paint dust left on the soil when the issue is cured.

I’ve written quite a few FHA appraisal articles in case you’d like to know more. Let me know if you have any questions.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I was interviewed yesterday by Sacramento Realtor Tamara Dorris on her internet radio show to talk briefly on the nuts and bolts of FHA appraisals. With her permission, I turned the 10-minute interview into a YouTube video to further share. These are some of the basics of FHA appraisals and may give you some insight into what an FHA appraiser is looking for during an appraisal inspection. I also have quite a few FHA appraisal articles written that you can check out. Watch the video below (or here). Enjoy.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I have some interviews and speaking engagements this month that I wanted to invite you to be a part of. Feel free to listen to interviews online or come to one of the events listed below:

January 11:  Interview with Sacramento Realtor Tamara Dorris on her internet radio station on 1/11/12 at 10am. I’ll be talking about FHA appraisals for 10 minutes at the beginning of her show. Check out Tamara’s website here for details.

January 19:  Effective Blogging for Real Estate: I’m teaching a class at the Sacramento Association of Realtors YPC forum from 9-10am at 2003 Howe Avenue in Sacramento on Thursday January 19. Here is the promo: “Blogging is an opportunity to share knowledge, build relationships and connect with existing and potential customers. If done right, a blog can help build credibility and expertise for your real estate business as well as serve as a place where potential clients can feel you out before deciding to do give you a call. This class is full of tips, how-tos and gives a very practical framework for how to create original content and plan posts. Ryan Lundquist runs the Sacramento Appraisal Blog, which is one of the top appraisal blogs in the State of California. Ryan consistently earns new business from his blog and he is considered a leader in his industry when it comes to building a strong online presence.”

January 19: Incorporating Video into your Content: I was invited by the Sacramento Social Media Club to share my experience with video as a local business. In case you didn’t know, I’ve uploaded over 200 videos over the past few years to YouTube and I also created a real estate video library called “Sacramento Real Estate Tube” that hosts nearly 400 videos thus far from local real estate professionals. Video has been something I’ve used to build trust online, be resourceful for clients, and earn business (there are of course quite a few random videos that have nothing at all to do with business, but everything to do with who I am). My plan is to talk about how I got started using video, why I do it, mistakes I’ve made, what specific tools I use and how I incorporate video into my business plan online. This should be an interesting evening because there will be a professional video specialist speaking first (Kerry Shearer) and then I’ll share as a local video practitioner. This will be an informative presentation, so come expecting to learn and have conversation too. I’m really looking forward to meeting people, sharing what I’ve done and learning from everyone. The event will be from 6-8:30pm at The Art Institute. There is a $15 charge. Reserve a ticket HERE.

January 26: Interview with Sacramento Area Loan Officer Sheri Schmitz on her internet radio station on January 26 (time and topic TBA – I’ll share details as I get them). Check out Sheri’s website here.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Might this ceiling fan be a safety issue for an FHA loan? What do you say? No biggie or an issue that’ll require repair before the loan can close? Have a look at the brief video below (or here) and let me know what you think.

If you said yes for being a safety issue called out in an FHA appraisal report, you are correct. FHA is primarily concerned that everything in a house works properly, there are no health and safety issues and there is a sense of economic longevity for the house too. Had I continued the video for a bit longer, you would’ve seen the fan shake even harder. If you don’t think it’s a safety issue, would you put your child’s bed underneath a fan like this? Probably not.

While an issue like this needs to be corrected before an FHA loan can be guaranteed, it’s really not a big-ticket item. Either the fan needs to be repaired or replaced or a cheap light fixture can be purchased and installed in its place. This is an older property and ceiling fans didn’t even exist when the property was built, so a simple light fixture is entirely reasonable in this case. This is not just my opinion either, but the Santa Ana FHA Home Ownership Center said the same thing during a recent phone conversation.

NOTE: This does not mean all wobbly ceiling fans will need to be repaired or replaced. This is where the FHA appraiser is subjective and has to use good judgment according to FHA guidelines and/or the spirit of FHA.

Let me know if you have any questions or insight. I hope this was helpful. You can see more FHA appraisal articles here.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.