What do you think this means?

The following graph was added as a result of a great question by Jeff in the comments section. “What were property values doing during this time?” was the question asked. It looks like the 95757 zip code has seen a clear decline in property value over the past three years. Yet at the same time it’s important to note the rate of decline has slowed down from previous years.

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.

How far have property values declined? Generally speaking, property values in Sacramento are at a level near 2001 right now. Some areas like Pocket / Greenhaven show a trend in 2002, whereas other zip codes in East Sacramento are closer to 2003, while still other zip codes or property types are definitely before 2001. Generally, the areas with higher values tend to sell near 2002 or maybe 2003 levels when considering the overall market median sales price by zip code. At the same time, many areas that we’d think of as “challenged” due to crime or other issues are definitely before 2001 in many cases. Keep in mind the median sales price by zip code encompasses an entire geographical area and may or may not represent a certain niche or neighborhood within that zip code (that’s the problem when looking at data for an entire area).

DOWNLOAD HERE: Sacramento Area Median Price Graphs for sales between 1997-2011 (PDF) from the Sacramento Association of Realtors. This may be helpful to glean some context into some of the aforementioned bits I mentioned above.

Any thoughts about unemployment or how the real estate market is doing?

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.

By the way, I have a few videos coming up in the next month or so with a local real estate investment specialist. The videos will highlight 2-4 unit trends in more detail. Be on the lookout.

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.

While we’re on the subject of Wilton, here are all sales in Wilton over the past five years. What do you see? Does anything stand out to you? The trend in many other areas of Sacramento tends to have a much sharper decline, but that’s less of the case here. What makes Wilton different in your mind? If you live in Wilton, what do you find desirable about the community?

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.

What stands out to you about the figures below?

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 just finished up an appraisal in North Highlands and I know the market really well in this particular neighborhood. I’ve been doing appraisals consistently over the past few years in a particular tract for an investor, so I’ve watched the market decline, seemingly stabilize during the tax credit season, and then decline again. The image below includes all of North Highlands as an example of the impact the tax credit appears to have had. There was an uptick in sales and the decline in property value seemed to stop while the credit was alive.

Now that the credit has been expired for over a year, how would you say it impacted the real estate market? Do you see this trend below in other neighborhoods or maybe just in markets under $200,000? What were the positives and negatives of the credit?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Here are my observations:

1. There is a vast range of prices among model match sales.
2. The neighborhood has seen a decline in value over time.
3. The range of sales is about $85,000. This range has been seen more or less over the past few years, which is important to note.
4. The sales at the top tend to back the greenbelt and have premium upgrades, while the ones at the bottom tend to be short sales. In this neighborhood short sales are tending to sell for less than foreclosures (for this model anyway).
5. The appraiser could botch the value if simply using model match short sales as “comps” while ignoring traditional sales at the top. At the same time, there could be money left on the table if the property is marketed against the lowest sales in the neighborhood. Also, the home owner could use all the wrong comps in a tax appeal too, right? This brings up the importance of working with local professionals and sifting through bank-owned, short sales and traditional sales to establish market value.
6. Having such a large range of sales means it may prove challenging for online valuation websites like Zillow and Cyberhomes to render a credible value. Granted, a reliable value is not always easy for human appraisers either to be fair, but actually seeing the property and understanding the market makes all the difference.

What stands out to you about the graph? What scenarios have you seen cause a huge difference in price among model match sales?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I just finished a tax appeal report for a home owner in Fair Oaks. His property is assessed at $281,873 and has been assessed at that level for the past three years. He originally purchased the property in 2003 for $292,000. All things considered, after a detailed analysis, market value on January 1 was actually $150,000, which is $130,000 less than the assessed value. This means the owner was scheduled to overpay by $1,648 this year (he easily overpaid these past two years also by $2,500).

Life is full and there are so many things to stay on top of, so it’s understandable to not pay attention to property taxes. However, think in terms of the exodus of greenbacks from your wallet that should be staying comfortable in your pocket. This home owner easily overpaid $2,500 over the past two years and was scheduled to overpay another $1,648 this year had he not contacted me. How does giving the county $4,000 of YOUR money sound to you?

Remember the deadline to dispute property taxes in Sacramento County is November 30, 2011. Contact me and I’ll be glad to explain how the process works and take a preliminary free look into your property to give a professional eye to your situation. By the way, you can look up your property HERE to see how the county has assesed you (your value should be based on January 1). The tax appeal world often feels like foreign territory for many home owners, so let me at least give you insight into what to do and how to do it. I typically charge $99 for a very solid appeal report that includes multiple trend graphs of your neighborhood, a market analysis, the best comps and the worst comps too if need be. You should only hire me or someone like me if there is a savings to be had though. Don’t waste your money on a report that is not needed. Whatever you do, pay attention.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Citywide stats are only so useful because sub-markets within a particular city might have drastically different figures. For example, Land Park and Pocket / Greenhaven will not show the same trends as the entire City of Sacramento mentioned above. Without making this post exhaustive though, let’s take this one indicator for what it’s worth. Overall any neighborhood under 30% in REOs and Short Sales would really be classified as “doing pretty good” for the current market. Despite 30% still representing 1 in 3 sales being distressed, it’s a fairly low percentage for a city or neighborhood. Even 50% seems to be a fairly common stat for areas that locals often think of as more “move up” kind of places. Many cities and neighborhoods have a foreclosure/short sale rate between 60-70%. It’s amazing to think that is normative, but it is definitely the case – particularly in cities where there was ample new construction during the boom years.

What do you think the information says about the health of the market? How does it impact real estate to have such a high percentage of distressed sales? What opportunities and threats exist in the current real estate market?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

1. North Sacramento home: Appraisal: $60,000;  Zillow: $87,000 (+45.0%)
2. Del Paso Area home: Appraisal: $110,000;  Zillow: $70,000 (-36.0%)
3. College Greens home: Appraisal: $270,000;  Zillow: $290,000 (+7.5%)
4. Serrano home: Appraisal: $550,000;  Zillow $466,000 (-15.0%)
5. Rancho Cordova home: Appraisal: $125,000; Zillow: $128,000 (+2.4%)
6. Elk Grove home: Appraisal: $185,000; Zillow: $185,100 (0%)
7. Elk Grove home: Appraisal: $280,000; Zillow: $255,000 (-8.9%)
8. Sun City Lincoln Hills: Appraisal: $415,000; Zillow: $403,000 (-3.0%)
9. Orangevale home: Appraisal: $145,000; Zillow: $165,000 (+14.0%)
10. Land Park area home: Appraisal: $305,000; Zillow: $270,000 (-11.0%)

In my experience Zillow is very much hit and miss. It can seem more accurate in newer cookie-cutter neighborhoods, but wildly off in other cases when neighborhood boundaries are very tight, data is scarce or condition varies greatly in the local market. Additionally, it seems to me that the listing price in MLS is given strong weight because Zillow can pull that data over to use in its algorithm.

I know you’re expecting me to say all this, but it’s true. Online valuation sites can be a nice tool to tinker around with for real estate and rental values, but nothing replaces the human element. This is really a classic “Terminator principle” example where “humans vs machines“ go to battle and humans win (sorry to give away the end of the movie). While algorithms can be very powerful, they cannot see important neighborhood boundaries, quality of construction, high-level craftsmanship, the motivation of buyers and sellers, condition, positive or negative location factors, any sense of charm or appeal, and so many other elements. On top of all of this, the real estate market in the Sacramento area has been a wild ride and it’s not easy to interpret. So many neighborhoods in Sacramento have close to 70% of all sales being either foreclosures or short sales, which complicates sifting through data to establish true market value. Distressed sales tend to sell for less, but not always, so it makes for a very interesting process to properly value a house.

My advice? Enjoy Zillow for what it is and take it with a grain of salt, but trust an experienced and local human appraiser for the final say.

Go check your Zillow value. Does it seem realistic to you? I’m curious.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Now let’s look at all sales in the City of Fairfield over the past five years to see if the neighborhood trend above echoes the overall trend in Fairfield. Do you see any similarities or differences?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

How does the graph below strike you?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

There is a very wide range of sales depending on the location of the duplex and of course potential for rental income. Sales in the upper tier tend to be units in Land Park, Midtown and East Sacramento, whereas duplexes around $50,000 tend to be located in North Sacramento and other portions near South Sacramento. What do you notice from the graph above? Any insight?

Sacramento Real Estate Investment Specialist Joel Wright unpacks the market:

In the last 3 ½ months of 2008 80% of properties sold were foreclosures.  During the most recent 3 months in 2011 foreclosures only represent 36% of the sales. Also short sales are happening now representing 24% of sales, which they were not 3 years ago when they only represented 8% of sales. This is a distinct shift in the market. Another distinct shift is that the average price has dropped 17.5% during that time from $186,500 to $153,500.  So while the graph shows the majority of sales occurring under 200k, the ones selling recently in 2011 are almost 20% cheaper. 

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.