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What To Do When Your Home Doesn’t Appraise At Its Purchase Price

January 10, 2013 by Jeff Cost

Experienced home sellers in Louisville know that reaching a sales agreement with a potential buyer can be just the start of the negotiation process. There are often inspection issues to resolve, among other items.

One particular negotiation point which can present difficulties for both buyers and sellers is when a home’s appraised value falls short of its contracted sales price.

Home appraisal remedies for home sellers Sometimes, this happens because the home’s price was inflated. Other times, it’s the result of a faulty appraisal.

As a home seller, there are some common appraisal problems of which you should be aware. Here are some of them, and how to seek remedy so that the home sale process remains smooth.

Inaccurate comparisons
An appraiser will assign your home’s value based on comparable properties and recent sale prices. However, some homes — notably those in foreclosure; sold via short sale; or which were abandoned — sell at a discount as compared to non-distressed properties. An appraiser may want to ignore these types of comparable homes, or make proper valuation adjustments.

Ignored market conditions
The housing market can improve quickly as we’ve seen in some U.S. markets since 2011. Appraisers, though, may not consider a local market’s demand and its rapidly rising prices — especially after the recent downturn from last decade. If an appraiser is not taking into account such information as multiple offer situations, low local inventory, and days on market, your home’s appraised valuation may be affected.

Slow turn-around time
Appraisers operate under strict time guidelines. When an appraisal takes more time than usual, therefore, it’s often the result of the appraiser’s uncertainty on the home’s value. This is a common scenario for unique homes for which comparable properties are scarce. It can also be the case for when an appraiser is unfamiliar with your area. If an appraisal takes an inordinate amount of time to complete, consider asking your REALTOR® to review the figures.

To err is human and appraisers make mistakes occasionally. How you handle those mistakes as a seller can be the difference between a sold home and a canceled contract.

27 Months Of Consecutive Job Growth Helping Home Prices Rise

January 9, 2013 by Jeff Cost

Job growth helping housing recovery The Bureau of Labor Statistics (BLS) Non-Farm Payrolls report for December exceeded Wall Street’s expectations by 5,000 net new jobs, showing 155,000 positions created in December.

The December tally raised the economy’s 12-month total to 1.84 million net new jobs created nationwide. Jobs added in December mark the 27th consecutive month of job growth.

Job sectors showing the strongest growth to close out 2012 included:

Health Care
Drinking and Eating Establishments
Construction
Manufacturing

Private-sector hiring is driving the jobs market, too. 168,000 new private sector jobs were added in December. Government jobs fell by thirteen thousand.

Monthly job creation has averaged +153,000 jobs since 12 months ago. It’s a fine measure of growth but economists believe it’s not enough job creation to significantly reduce the national unemployment rate. 14.4 percent of workers are categorized as under-employed.

December’s national unemployment rate was 7.8 percent, representing 4.8 million job seekers. This figure matched Wall Street’s expectations and was equal to November revised unemployment rate of 7.8 percent.

The improving jobs market and national unemployment rate make an impact on both mortgage rates and Cincinnati home prices.

Job creation suggests an expanding economy, which typically leads mortgage rates higher. In addition, with more employed persons nationwide, the potential home buyer pool grows larger, which introduces new demand to the housing market. With more demand, all things equal, home prices rise.

Job growth is one reason why home values climbed more than 5 percent in 2012, according to the Federal Home Finance Agency; and why the national housing supply would be exhausted in fewer than 5 months, at the current sales pace. Demand for homes is high and today’s low mortgage rates are extending buyer purchasing power in OH.

For home buyers, the expanding U.S. economy and steady job growth suggests that home prices may not rocket higher this year, but will continue to increase, little by little.

Choosing “Green Homes”

January 8, 2013 by Jeff Cost

“Green” homes can be great for the environment and can save you money over time.

For environmentally-conscious homeowners wanting to minimize their footprint and their energy bills, there are four areas upon which to focus.

In-Home Energy-Efficiency
According to the Environmental Protection Agency (EPA), as of December 2012, buildings account for 68 percent of the nation’s total energy consumption. Green homes can reduce this figure via energy-efficient appliances; well-sealed, double-glazed windows; and good insulation. Alternative energy sources such as solar panels can also reduce energy use.

Green Building Materials
Building materials are determined to be “green” based on manufacturing, shipping, and reclamation procedures, and are composed of renewable resources. Reclaimed materials such as wood from an old barn; or recovered newspapers for use in insulation are often considered to be green. Counter-tops made from recycled materials are often considered green, too. Ceramic tiles, because of how much energy is required to form them, are often not considered green unless reclaimed from a demolition project.

Home Location And Orientation
A home for which the main living areas are facing south will be warmed by the sun in winter, and will not be overheated by the sun in summer. This is considered “green”, as is proper window placement which allows for cross-breezes which can lower energy costs on warmer days. Living in proximity to work and other frequented spots can reduce automotive energy consumption, too.

Indoor Air Quality
Good air quality means promoting a safe, toxin-free environment. Using non-toxic paints in your home plus other green materials can improve air quality. Most notably because, over time, synthetic paints and materials break down, releasing harmful particles into the air.

When buying a green home in Louisville , be sure to ask questions of the seller including how the home was built, which materials were used in construction, and whether the home’s appliances are Energy Star-rated.

What To Do When Your Home Doesn’t Appraise At Its Purchase Price

27 Months Of Consecutive Job Growth Helping Home Prices Rise

Choosing “Green Homes”

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