Sacramento Appraisal Blog

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Unpacking the real estate market in Sacramento: The Wright Report

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If you want to understand the real estate market in Sacramento, check out The Wright Report. I am not aware of any other report in the area that is so comprehensive. The Wright Report is birthed quarterly by Real Estate Broker Joel Wright. The latest version is packed full of graphs and details to help the reader understand exactly what went on during the last quarter of 2010 in Sacramento’s four county region (Sacramento, Placer, Yolo, El Dorado). This is helpful for local agents, residents and anyone considering investing in the Sacramento region. I recommend downloading and printing the document since it is over 40 pages.

I’m honored to have contributed a few paragraphs at the beginning of the report too. Check it out below or see a full screen view or direct link).

What do you think?

 

If you have any real estate appraisal, valuation consulting, or property tax appeal needs, contact me at 916.595.3735, www.LundquistCompany.com or via Facebook.

Are websites like Zillow accurate? My last five appraisals vs. Zillow

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Are websites like Zillow accurate? Let’s compare my last five appraisals with Zillow estimates. These are all subdivision non-custom homes in the Sacramento area. I won’t give the property addresses of course because that would violate client confidentiality.

1) House in Tracy: Zillow high by 9.2%
Zillow said $295,000, whereas my appraisal was $270,000. The condition of this house makes a huge difference in market value. Actually, if this house was in decent shape, $295,000 would be a bit on the low side (quick sale value). 

2) Elk Grove House: Zillow low by 1.4%
Zillow said $207,000, while my appraisal on this 95624 property was $210,000. Not too shabby. Pretty close.

3) Elk Grove House: Zillow high by 6.25%
Zillow said $170,000, while my appraisal on this 95758 property was $160,000.

4) Rancho Cordova House: Zillow high by 41.6%
Zillow said $177,000, but my appraisal on this house in the 95670 zip code was $125,000. Zillow most likely used an area as square footage that should not have been used since Tax Records shows this property with a much larger square footage than it actually has. Zillow was also unaware of condition issues. Even if the property was pristine, $177,000 would still be on the high side since remodels are typically $150-160K right now for this area. The market is fairly patchy too in this neighborhood as some streets show much better than others.

5) Sacramento Property: Zillow high by 30% 
Zillow said $94,000, but my appraisal for this property in the 95824 zip code came in at $72,000. Remodeled or flipped properties tend to sell closer to $100,000 in this neighborhood. The subject is average in most regards- not a fixer.

Conclusion: It’s really hit and miss with Zillow. As I said in a previous article, websites like Zillow seem to have greater accuracy in tract markets with ample sales, but even then they are only so good because they cannot sift through value indicators like condition, important neighborhood boundaries, the difference between distressed sales and regular sales, upgrades, and a local appraiser’s knowledge of the market area.

Will websites like Zillow replace real estate appraisers some day? Personally, I’m not so concerned because: 1) These websites are not very accurate and therefore probably not a good source for making legal or lending decisions. 2) Lenders and other users of appraisal services need to use real humans who can do a professional and accurate job – and humans carry E&O insurance (ding, ding, ding). The bottom line is that it all comes down to money. Lenders probably can’t sue an online “machine” for messing up their value, but they can sue a human.

What do you think?

If you have any real estate appraisal, valuation consulting, or property tax appeal needs, contact me at 916.595.3735, www.LundquistCompany.com or via Facebook.

FHA Appraiser Tip: Strapped water heaters & garage doors in Sacramento

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There are many requirements for a property to qualify for an FHA loan. It’s important to understand all the little things if you are considering getting an FHA loan, selling your Sacramento area house or listing a property for a client. If you didn’t know, FHA loans comprised 28% of the market in 2010 in the Sacramento area, so details like this are very important.

In this video I take one minute to discuss the importance of water heater straps and self-closing garage doors. You can view other videos and FHA content here. Keep me posted if you have any questions.

If you have any real estate appraisal, valuation consulting, or property tax appeal needs, contact me at 916.595.3735, www.LundquistCompany.com or via Facebook.

How HVCC has been a catalyst for my business

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My industry changed in a huge way two years ago. Many real estate appraisers are actually no longer in business because they were basically sideswiped when something called the Home Valuation Code of Conduct (HVCC) came along.

I get asked quite a bit about HVCC and how I feel about it, so I wanted to offer my two cents. This is probably not what you were expecting to hear, but HVCC has actually been a catalyst to take my business to the next level. Look, I’m not an HVCC groupie by any means, but rather than focus on the problems created for the appraisal industry due to HVCC, I have worked hard to expand niche areas of business instead. It’s in my DNA to find solutions – whether with business or community involvement. Watch the video below to hear my story.

Has your industry experienced changes in recent years? How did you respond to these changes? Why do you think some of us see opportunities during hardships while others only see threats? Is the glass half full or half empty for you?

If you have any real estate appraisal, valuation consulting, or property tax appeal needs, contact me at 916.595.3735, www.LundquistCompany.com or via Facebook.

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