Apr 28, 2011 | Real Estate
When visiting with someone who may be considering selling their home I typically ask how much they think their home is worth. Sellers have generally either talked to a neighbor that recently sold or researched on the internet to come up with their number. Some of that research may include the popular website Zillow.com. While Zillow is a good platform for real estate information, many people using their Zestimate function do not realize that there is a margin of error and the level of accuracy varies by location.
Zestimate Accuracy Table
Each location is given a star rating based on accuracy. Notice the Dallas-Fort Worth area has two stars which is considered a “Fair Zestimate”. Now let’s look at what is considered “fair”. Zillow estimates that its Zestimate is only within 5% of the sales price 22% of the time, within 10% 39% of the time and within 20% of the sales price 63%. That means that for more than half of the estimates given on the site they can be off by as much as 20% – that is huge! Consider a home priced at $200,000 – that’s a $40,000 difference!
You certainly don’t want to price your home 20% higher (or lower) than what home are actually selling for so ensure you consult a trusted REALTOR(r) when you begin considering a move to see where you really stand in the market. We are always happy to discuss your home’s current value in the market, so don’t hesitate to ask!
Apr 26, 2011 | Buyers, Homeowners, Property Valuation, Real Estate, Sellers
Frequently when showing buyers properties or discussing making an offer on a particular property a buyer will want to know the tax valuation on the home. Of course we always provide the answer, but remind them that the tax assessment on the home is not related to the market value, the two figures are mutually exclusive. Market valuation is the price currently set for a home based on recent neighborhood sales and the overall real estate market, it is what a buyer would pay to purchase the property. Property tax valuation is the basis for which an owner will pay property taxes.
The appraisal district for a county assesses homes based on an exterior analysis along with general market knowledge as of January 1st each year. Since Texas is a non-disclosure state (meaning the price you pay for a property is not public knowledge) the appraisal district is not able to use an actual sales price of a property unless a new property owner replies to the appraisal districts optional purchase price survey giving them that particular information. Homeowners will receive the districts assessment in May each year with their valuation for the year. In order to save money on property taxes owners will want the tax assessment value to be as low as possible and have the option protest the valuation if they believe it to be too high.
Market valuation is determined through an analysis of similar properties that have recently sold. The information used to determine this value is not public information so you will need a real estate agent or an appraisers to share the information and how your home fits into the market.
To further demonstrate the disconnect between these two numbers, consider two home owners in the same neighborhood with the same floor plan and amenities. Owner A has consistently and successfully protested to keep his tax valuation lower for several years while Owner B has accepted the ever increasing tax valuation each year without protest. When these owners put their homes on the market should it really matter what the property tax valuation is? In fact as a buyer you may prefer the home with the lower valuation so your taxes will also be lower, but it does not mean the property is worth any less on the real estate market.
Tax valuations will be coming out in May so if your home goes down in value, just breathe a sigh of relief for a lower tax bill and if you need a market valuation on your home contact us to provide you with our solid, market information and knowledge without any obligation.
(Of course, this information is most relevant to to the North Texas area where I specialize. If you live in another area, please consult a local REALTOR(r) for information about tax assessments and valuations in your area.)
Apr 13, 2011 | Foreclosures, Sellers, Short Sales
Sometimes selling your home may not be the only (or the best) option for you depending on your long and short-term real estate goals. When you have a knowledgeable, experienced real estate consultant we can help show you all the options that are available to you and how they could benefit you.
Options May Include:
Selling Your Property. Sometimes you just need to sell your property, and unfortunately that may not happen the first time you list it for sale. Let’s visit about why it may not have sold, make necessary corrections and get it back on the market with a customized marketing plan to get it sold.
Short Selling Your Property. If you are having trouble making the mortgage payments, facing foreclosure, owe more than you can sell your home for or must relocate immediately whether your home sells or not then you may be a candidate for a short sale, also referred to as pre-foreclosure sale. Your lender does not really want to own your home, that’s not their goal, so they may agree to accept less than what is currently owed on the note to not have to incur expensive foreclosure costs. Currently in the financing world lenders look at short sales more favorably on your credit report than a foreclosure and say you may be able to reapply for another mortage in as little as two years as opposed to the seven usually required for a foreclosure. I am a certified Short Sale and Foreclosure specialist with the coveted SFR designation meaning I have had the most up-to-date training available currently for the real estate industry in this new and specialized area. Even if the foreclosure is looming close – it still may not be too late!
Leasing Your Property. Maybe your neighborhood has experienced a recent decline in property values so now is not the best time for you to sell. The leasing market is very hot right now and may allow you to “cover” your mortgage and wait for a better time to sell in the future. Or maybe the investment option of gaining equity in a property without making the payment yourself is appealing to you. Our team can help with our leasing and/or property management services.
These are some of the most common options used by sellers to achieve their real estate goals, but it is not all of them. Call me to schedule an appointment to discuss your specific situation and goals and let’s see what we can do. How will you know if we can help, unless you call?
Apr 8, 2011 | Buyers
In a recent Forbes blog post, multimillionaire hedge fund manager John Paulson declared that today’s record-low interest rates made this the best time to buy homes in fifty years. “If you don’t own a home, buy one,” Paulson said. “If you own one home, buy another one, and if you own two homes, buy a third and lend your relatives the money to buy a home.” Why should we care what Paulson thinks? Well, he was among the few to accurately predict the subprime collapse and, while no one has a crystal ball, a closer look at the numbers supports his call to action. Historically low interest rates are the key…and they aren’t likely to hang around for long.
Buyers who “choose to wait until prices come down more” are gambling that interest rates will hold steady or drop. The truth is even a 10 percent drop in home prices is nullified by a 1 percent increase in interest rates. The figure below illustrates how this works for a $250,000 home purchase and the relative likelihood of each scenario.
To figure out which was a smarter bet–counting on home prices to fall further or interest rates to rise– the Keller Williams research department took the last ten years of monthly home price and mortgage interest rate data and ran the numbers to see which was more likely: an increase in mortgage rates or a further drop in home prices.
Here’s what they found:A one percent increase in mortgage rates is ten times more likely to happen than a ten percent drop in home prices.A one percent rate increase more than offsets a ten percent reduction in home prices.When interest rates fall by one percent, the total interest paid is almost three times more than the interest savings from a ten percent drop in home prices.The probability of both happening at the same time is ridiculously small, and homeowners would still pay 15 percent more in interest over the life of the loan.
Interest rates have dominated the news in recent months as we’ve shattered record low after record low. Potential home buyers need to understand the positive financial impact low interest rates have on the cost of home ownership and the thousands of dollars that can be saved over the life of a typical mortgage loan. For those who can afford to buy, trade up, or invest, our current market presents a lifetime opportunity – call me, your local real estate consultant, to help provide you the information you need to make an informed decision.
Apr 5, 2011 | Sellers
Spring has sprung and the real estate market is moving. I need some more sellers! 2 listing under contract in the last few days with multiple offers on both properties – I need more great homes to sell. If you are thinking of selling this year – let’s talk
