Do Appraisers Use Distressed Properties as Comparables?

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This is a major issue real estate industry professionals are dealing with in this tumultuous market. In general, people want the most cash for their home that they can get. If they get a full price offer, that is fantastic, but the problem is that most of these homes are appraising for much less than the agreed price. This complicates the deal and could possibly terminate it all together. If appraisers are using distressed properties for appraisals (which they definitely are), it can change the price dynamics of the market. Below is a great article provided exclusively by kcmblog.com

Many of our readers ask us if appraisers use distressed properties (short sales and foreclosures) as comparables when doing an appraisal on non-distressed properties. We have posted on this issue on several occasions (examples: here and here). Last month, the Appraisal Instituteissued a paper on the subject. In the paper, the Institute explained that:

“Foreclosures and short sales can provide important information for appraisers, who develop valuations based on market data and market forces.”

On whether an appraiser should use distressed properties as comparables, the Institute was very direct (all items in bold were shown as bold in the original paper):

“An appraiser should not ignore foreclosure sales and short sales if consideration of such sales is necessary to develop a credible value opinion.”

And they explained the possible differences between short sales and foreclosures:

“A short sale … might have involved atypical seller motivations and so might not be an ideal comp…

A sale of a bank-owned property might have involved typical motivations, so the fact that it was a foreclosed property would not render it ineligible as a comp.”

Bottom Line

Some will argue that distressed properties should not be used when appraising non-distressed properties. However, there is no longer any doubt that they will be.

Harry Norman, Sr. was a leader in the Atlanta real estate industry for many many years. When I first joined Harry Norman, Realtors, all I heard about was what he stood for, and how he made HNR into the company is is today. I am proud to be associated with the Harry Norman name and congratulate the entire Harry Norman family for this honor.

Cary Daniel Blumenfeld
Consultant
Harry Norman, Realtors

What Does Warren Buffet Think About Buying A Home?

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Warren Buffet is seen by many as the greatest investor of our time. When he speaks, people listen. Like anyone else in his position of influence, he is criticized by some for using his bullhorn to promote his own business agendas at times. That makes it very interesting when we occasionally learn of how he privatelyadvises those closest to him.

Such a situation occurred this week. Debbie Bosanek, Warren Buffet’s secretary of 37 years, recently purchased a second home in Surprise, Arizona.

In an article in the Omaha World Herald, Mrs. Bosanek discussed her reasons for purchasing a second home and the personal advice she received from Mr. Buffet.

“I just thought it was time to buy a home. Warren tells me that it will be the best opportunity in my lifetime. Mortgage rates are low and prices have dropped dramatically…I share Warren’s view about the future of America, and we believe that our country will do just fine. I’m happy to make this investment.”

The greatest investor of the last century privately has told the people closest to him that buying a home right now will be the best opportunity in [their] lifetime”.

That’s good enough for us. How about you?

Article Provided by The KCM Blog http://www.kcmblog.com

Do You Support Breast Cancer Awareness? Come Paint @ Toco Hills – Sips N Strokes!

Do you love to paint?

Are you a supporter of Breast Cancer Awareness?

Come paint @ Toco Hills — Sips n Strokes this Friday night!

Choose from 2 beautiful pink ribbon pictures…

Bring your friends, drinks and food….

5$ from each person will be donated….

**Also check out the other great paint nights we are offering throughout the month in our newsletter below**

Cary Daniel Blumenfeld

Harry Norman, Realtors

Brookhaven Renovation Part 2

Today we dug really deep and managed to finish gutting the bathroom. It turned out to be a pretty difficult task as there were some obstacles we faced while breaking down the walls and the flooring. The first issue we encountered was the shower drain falling through the sub flooring and into the crawlspace. The wood had become so warped and damaged due to water and old age that when we pulled up the surrounding floor, it just broke off completely. We encountered a few surprises along the way, such as the patched window that was located in the same place the old vinyl shower insert had been. The wiring we found throughout the bathroom had obviously not been changed since when the house was built, circa 1940. This is evident in the prehistoric electrical configuration we found behind where the sink used to be. The main drain pipe supplying the house had been hacked into numerous other times, whether it was renovation or just fixing problems, it became a problem for us. The pipe had been vented correctly, but you can see where contractors had cut beams almost in half trying to correct spacing issues, rather then fixing the problem correctly. If you take a look at the overhead pictures, you can see where the vent is still located. We realized that the vent had been covered in insulation and was actually a pretty major fire hazard. Also due to the insulation coverage, there was no circulation in the bathroom, cause a massive amount of mold to develop throughout the entire bathroom. I consider us lucky because I truly felt as though we were going to find leaking pipes, and worst case scenario, a leaking roof, but all it turned out to be was an insulation smothered and covered fan. Pure Luck. We got the entire sub flooring up and realized that the drain pipe servicing the sink had been slowly leaking. It ended up not being a big deal because we had decided not to keep the old tile due to the preexisting warping that told me there was water under it in the first place. Stay tuned for more updates as I take you through the complete renovation process of the Brookhaven Property.

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Cary Daniel Blumenfeld

Harry Norman, Realtors

http://www.cary.blumenfeld.harrynorman.com

10 Risky Home Improvements You May Want To Reconsider By Jeanine Skowronski (via julianhartrealestate)

Check out this great article about renovations by Jeanine Skowronski.

Cary Blumenfeld
Harry Norman, Realtors
cary.blumenfeld@harrynorman.com
http://www.harrynorman.com

10 Risky Home Improvements You May Want To Reconsider By Jeanine Skowronski California realtor Carrie Benuska was ready to close on a house when the buyer pulled out during escrow. The reason for the last-minute turnaround: a bonus room her clients added to the back of their home years earlier. "This bonus room was not bonus at all," Benuska told MainStreet. "The room spoiled the flow, was built in a sub-standard way, and required the buyers to r … Read More

via julianhartrealestate

The Next Cool Thing…witness creative history


For Tickets Contact Cary at 678-983-7987

RED Carpet Cocktails

Experience the magic as we kick off a weekend of live performances, visual amazement and creative collaboration. $35 Tickets for this VIP event are available on-line and through any of the participating sponsors. Dress your best because this is a see and be seen party. No one under 21 admitted. Sample food and beverages from dozens of the top catering, restaurant and libations experts in Atlanta.

Doors open at
7:00 pm until 11:00 pm

Friday, January 14

VIP Gala

This event is by INVITATION ONLY for professionals in the film & TV, entertainment, design(interiors, graphics, design/build), performing arts and event industries.  This black tie optional event is expressly for the purpose of business networking.  Only spouses and significant others will be invited to attend with a member of the creative community. This GPP fund raiser has a suggested donation of $20 per person at the door. To get invited contact a sponsor or exhibitor.

7:00 pm until 11:00 pm,
Saturday January 15

Everyone’s Invited

The whole family is invited to explore hundreds of creative exhibits based on movie or television themes. Sample the wares of the latest sensational food trucks and surprise performances.  Young children must be supervised and security will be tight. Tickets are $10 available on-line and $15 at the door. Great photo opportunities, so bring your camera!

11:00 am until 4:00 pm,
Saturday, January 15
1:00 pm until 4:00 pm,
Sunday, January 16

If you are interested in attending any of these events, please contact Cary at 678-983-7987