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Understanding Appreciation Written by Steve Cook    Thursday, 03 July 2008 09:43 For the last few years, most places in the country have been experiencing tremendous appreciation in the values of real estate. For the longest time I talked about how my house went up in value and, daily, I hear many others talk about how their homes have appreciated in value. Well, I have news for you, houses do not appreciate in value. Yes, you heard me correctly. Houses do not appreciate in value. You probably think I’m crazy, but let me explain. At the moment, I happen to live in one of the hottest real estate markets in the entire country. While there are many people out there clamoring for deals, I’m passing on deals. While others think the market is drying up, I’m still finding more then I want to deal with. How can this be, you ask? Read more...

The Average Appraisal and the Flip Written by David Whisnant    Thursday, 03 July 2008 09:42 One of the strategies that is in almost every real estate course involves finding a torn-up and ugly property at a cheap price, pay someone $300 to clean out the personal belongings of the prior owners (if you even do that much), and then resell it to a homeowner as a "fixer-upper" with little or no work. This type of deal seems to benefit everyone. You get a nice quick profit, and your buyer gets the house for a good price. Read more...   The Art of the Residential CMA Written by Nancy Chadwick    Thursday, 03 July 2008 09:41 If it’s done correctly, a Comparative Market Analysis (CMA) can be the next best thing to an appraisal in approximating the value of a property. The purpose of the CMA is to analyze data from properties similar to the subject that have sold recently in order to project the realistic price at which the subject property would sell. RE agents and brokers tend to develop their own methodologies for doing CMA’s. I’m not an appraiser, but what I’ve always done is make upward and downward adjustments to the projected value of the subject based on features and characteristics of the comparables I use. Admittedly, these are subjective, and some are based on “gut” feelings while other adjustments come about through rules of thumb I have developed from experience. But putting a value on real estate is an inexact science at best, and this methodology has worked pretty well for me over the years in CMA’g residential properties. I use a completely different method for projecting the value of land and property with residential development potential. Last Updated on Thursday, 03 July 2008 09:43 Read more...   Not Just Price Written by Nancy Chadwick    Thursday, 03 July 2008 09:40 How Builders Evaluate Land Some builders search for property strictly by geographic area. Others search for parcels that would enable them to reach particular buyer sub-markets (housing type, price range, lifestyle, age group). Either way, builders begin the investigation by casting the net into their areas of markets of choice and sifting through potential acquisition candidates. They have to pick through dozens of properties before they find one they think they can develop profitably. Sometimes they can tell quickly if a property is worth pursuing further. More often, however, they don't know this until they spend varying amounts of time, effort and money collecting information about a site. In either case, their investigation focuses on obtaining answers to five fundamental but critical questions: What can I build? How many can I build? What can I sell them for? How long will it take to sell them? What are the costs? Read more...   Investors - Determining Values in this Crazy Market Written by Lou Castillo    Thursday, 03 July 2008 07:46 The other day I had a call from an investor friend who asked how I determine values in this crazy market. The first thing to do is to pull the comparable property sales. Comparable property sales are properties that are as close to the subject property as possible. I know that an appraiser would say that you could take properties from as far away as a mile but we know a mile away is a long distance and neighborhoods can change significantly in a mile. I look for properties as close to the subject property as possible. The best would be on the same street, block or neighborhood. Last Updated on Thursday, 03 July 2008 09:04 Read more...   How to Accurately Estimate a Property's Current Market Value Written by Thomas Lucier    Thursday, 03 July 2008 07:44 The most common mistake that many beginning real estate investors make is that they pay too much for property. Fact is overpaying for property is often cited as the number one reason why so many newcomers fail to make it as profitable real estate investors. That's because most beginning real estate investors are woefully undercapitalized, and they don't have the deep pockets that are needed to subsidize their overpriced real estate investments. Last Updated on Thursday, 03 July 2008 09:04 Read more...