tag:blogger.com,1999:blog-13681246684799087912009-09-24T02:29:33.069-04:00Valuation HomeLearn how Macro and Micro Factors Influence Real Estate ValuationAnwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.comBlogger31125tag:blogger.com,1999:blog-1368124668479908791.post-67719961333424206272009-08-23T20:28:00.002-04:002009-08-23T20:34:25.510-04:003 Graham Rd Lexington MAMagnificent twelve room Colonial custom built by master craftsman. A fabulous blend of formal and comfortable casual spaces, this new construction is the epitome of inpired design.French doors, coffered ceilings, an elegant front foyer, built-in cabinetry, and recessed lighting are a few highlights of this exceptional property. The fireplaced living room and the dining room are gracious, while Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-83155374703427972622009-01-28T07:43:00.002-05:002009-02-05T14:14:43.049-05:008 Critical Adjustments in a CMA1. Property rights2. Conditions of Sale (Motivations of buyers and sellers)3. Financing terms4. Market conditions at the time of sale5. Size6. Location7. Physical features8. Economic characteristicsWhen preparing a Comparative Market Analysis, it would be prudent to place the most weight on sold properties while preparing another CMA with currently listed property. Investigate reasons as to why Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-88463248668553811752009-01-09T00:33:00.003-05:002009-01-09T00:42:25.752-05:00Mortgage Rates below 5%!Fixed mortgages have fallen below 5%. Large banks such as JP Morgan, Chase & Co., and Wells Fargo have lowered rates as the Fed Reserve have substantially increased their purchases of mortgage securities backed by Fannie, Freddie, and Ginnae Mae.Homeowners can take advantage of these low rates if their financial house is in order. Investigate whether refinancing makes sense for you. Make sure Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-48863910058071206382009-01-07T09:46:00.002-05:002009-01-07T09:46:52.017-05:00Waiting for the BottomSounds quite simple, right? Wait for housing prices to bottom out and purchase a home at the lowest price and then sell at the top of the market. The problem is, due to market inefficiencies, one never knows when the market hits rock bottom, until it is too late. It is extraordinarily difficult to forecast the market with any degree of certainty. Real Estate is affected by too many unpredictable Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-14600651204213132302008-12-17T14:21:00.004-05:002008-12-17T14:34:16.975-05:00Winter BluesThe Winter season is normally the cold period for Real Estate. People are busy enjoying the holidays and traveling with loved ones. The last thing they want to do on a blustery Sunday afternoon, is to go look at property. Most people wait until the Spring to put their house on the market.However, in the current economic climate and with housing inventory sky high, you may not have the luxury Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-56447429223756180142008-12-11T07:13:00.002-05:002008-12-11T15:42:09.302-05:00The power of inflation (or deflation!)The erosion of purchasing power (inflation) occurs when the general level of prices rises. Changes in anticipated inflation can have a significant impact on Real Estate. Changes in perceptions of long term inflation often cause mortgage interest rates to rise, affect affordability and therefore prices of property.Inflation and appreciation affect yield rates in different ways, though their Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-52462154598359813572008-12-05T10:13:00.004-05:002008-12-05T10:21:36.759-05:00Pricing PropertyPricing property is part art and part science. Besides locating similar homes to compare towards, home buyers and sellers must make certain pricing adjustments, based on market data. Though people traditionally take into account differences in size, number of bedrooms, and upgrades, they often overlook several crucial elements.These elements include adjusting prices depending on which property Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-76508221766789124352008-12-01T19:52:00.002-05:002008-12-01T19:54:38.543-05:00Why it's good to purchase in a down marketIn a red hot market, prices are appreciating, credit is easy to come buy, and everybody is making a bundle. People are in euphoria and are purchasing houses without truly analyzing the market and forecasting changes. The only sure thing is that real estate is cyclical in nature and will have peaks and valleys. Emphasis should be placed on the fundamentals. People who purchase in a hot market Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-46720859983829257172008-11-24T11:16:00.003-05:002008-11-24T11:17:54.029-05:00New S&P Case/Shiller Index!The first S&P Case/Schiller Housing Index for Condos has just been released. The Case/Shiller Index is a constant quality index measuring the changes in value of homes over time. Previously, these indices tracked price movements of single family homes only.Condos are affected by different market forces and appeal to a different segment of the population. Young professionals and the elderly Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-78250438740184868492008-11-18T13:29:00.002-05:002008-11-18T13:32:34.485-05:00Foreclosures and Short SalesTypically, Real Estate markets have been dominated by homes sold between people who have relocated, have children and need more space, or have a desire to upgrade/downsize. For many obvious reasons, short sales and foreclosures have now become a much more significant part of the market. As their influence in affecting market values continues to grow, I wonder how various housing indices Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-66787278024283918842008-11-10T15:04:00.002-05:002008-11-10T15:07:48.893-05:00Fiduciary DutiesPeople often question the motives of Realtors. It makes sense. Realtors receive a commission based on the selling price of a home. I think it’s reasonable to assume that they might influence you to purchase a home which they can earn a higher commission, or sell a home at a lower price in order to induce a quicker sale.However, Real Estate is a regulated business. State law with regards to Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-14154475781630902622008-11-03T13:47:00.001-05:002008-11-03T13:48:53.334-05:00Critical differences between condos, co-ops, and single family housesThree homes are for sale, each for $250,000. A fee simple house has only 2 bedrooms and is outdated. A Condo is newer with a swimming pool and an extra study room. A co-op was built just last year and has 4 bedrooms with a bevy of amenities (pool, sauna, workout room, and clubhouse). Which one should you choose?That depends entirely on the rights that are being conveyed, tempered by Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-57432605496130051442008-10-27T13:16:00.001-04:002008-10-27T13:17:36.162-04:00Adjust for FinancingSellers may provide below market financing in an effort to lure potential buyers, induce a sale, or to maintain a façade of higher prices, especially in a condo or planned unit community in a down market.Developers selling recently constructed property in a community have an extra incentive to maintain high market prices since they are concerned with the sale of multiple properties. They may Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-78517369173152186842008-10-21T14:06:00.004-04:002008-10-21T14:10:17.579-04:00Statistical Analysis a Panacea?Availability of market data often determines which techniques are employed in the valuation of property. In the absence of sufficient comparable properties, but with a wealth of market data available, analyst can use statistical analysis to test how certain factors affect market prices. Sometimes, analyst can distill certain market patterns to support valuation. When there are few comparables,Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-6653745488849224172008-10-15T10:25:00.002-04:002008-10-15T10:28:40.599-04:0012 Great Ways to Analyze PropertyQuantitative1. Paired data analysis (sales and resales of the same or similar property)2. Grouped data analysis3. Secondary data analysis4. Statistical analysis5. Graphic analysis6. Trend analysis7. Cost analysis (cost to cure, depreciated cost)8. Direct comparisons9. Capitalization of Income differencesQualitative10. relative comparison analysis11. ranking analysis12. personal Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-71657055877791346112008-10-06T16:56:00.003-04:002008-10-10T14:18:16.639-04:00Financial CrisisThe news has been dominated by the current credit crises affecting global markets. Due to extensive media coverage, many Americans are now familiar with how Freddie and Fannie affect the secondary mortgage markets and what subprime and alt A loans are. The unchecked growth of the derivatives market, collateralized debt obligations, and credit default swaps has wrecked havoc on the financial Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-45123269530922505812008-09-29T14:09:00.003-04:002008-10-02T18:08:45.581-04:00Waiting for the BottomSounds quite simple, right? Wait for housing prices to bottom out and purchase a home at the lowest price and then sell at the top of the market. The problem is, due to market inefficiencies, one never knows when the market hits rock bottom, until it is too late. It is extraordinarily difficult to forecast the market with any degree of certainty. Real Estate is affected by too many Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-73723113410825183332008-09-26T00:25:00.003-04:002008-10-02T18:10:52.324-04:00People You should KnowKnowing the difference between real estate sales people, financial officers and executives, and licensed and certified real estate appraisers is crucial. Real Estate salespeople are generally knowledgeable in a given locale, have access to historical data, and have training in the marketing, purchasing, and selling of real property. They may or may not have appraisal training and can often Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-2364862687757496122008-09-24T07:39:00.005-04:002008-10-02T18:11:00.604-04:00How Time Affects Real Estate PricesYou’ve found your dream home and are working up a Comparative Market Analysis to see if it is priced properly. Due to the nature of inefficient markets in Real Estate, the only comparables you can find were sold over a year ago. How can you adjust for time?Technically, you shouldn’t. Time does not affect real estate prices. Changes in market conditions, such as appreciation or depreciation inAnwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-57660055763345776702008-09-22T07:14:00.004-04:002008-10-02T18:11:09.057-04:00What If's?In Real Estate valuation, we constantly deal with uncertainty and risk. The “What Ifs” (housing prices fall, interest rates rise, expenses increase, etc) can wreck havoc on even an experienced home buyer and investor. With the advance of electronic spreadsheets and computer programs, we can now explore a myriad of what ifs quickly and easily with sensitivity analysis. With an electronic Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-89256129728501896512008-09-19T06:17:00.008-04:002008-10-02T18:11:17.655-04:008 Critical Adjustments in a CMA1. Property rights2. Conditions of Sale (Motivations of buyers and sellers)3. Financing terms4. Market conditions at the time of sale5. Size6. Location7. Physical features8. Economic characteristics When preparing a Comparative Market Analysis, it would be prudent to place the most weight on sold properties while preparing another CMA with currently listed propertyAnwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-14541444307715255612008-09-17T07:22:00.006-04:002008-10-02T18:11:24.815-04:00The Fed, Importance Overstated?The Federal Reserve regulates money and credit in the United States, which is vital for Real Estate. Their recent bailouts or lack of one of major companies have been intensely reported by the media as giants Bear Stearns, Freddie and Fannei, Lehman Brothers, Merrill Lynch,and A.I.G have had enormous financial difficulties. The Fed influences the flow of money in three ways: through their Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-27613418216299834232008-09-15T13:58:00.008-04:002008-10-02T18:14:05.162-04:003 Real Estate Myths1. Foreclosed Property represents a great bargain. When you see a “bargain” foreclosed property for sale, be extremely careful. Check for contingencies, warranties, and rights being sold and adjust accordingly when comparing to other property. Ownership interest and warranties on a bank owned property may not be comparable to the neighboring house. Remember, the previous owner tried to sell Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-21106855578384279382008-09-11T09:27:00.019-04:002008-10-02T18:14:35.586-04:00FSBO's, What You Should KnowIndividuals who try to sell FSBO can save money on commissions if you have the necessary valuation and marketing tools. You must be able to ascertain the market price for the property. The best and easiest way to do this on your own is to hire an appraiser. Now comes the difficult part. You might have the nicest house for the lowest price, but if no-one knows about it, what is it worth? You need Anwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0tag:blogger.com,1999:blog-1368124668479908791.post-85207229881259183502008-09-11T09:27:00.018-04:002008-10-02T18:14:25.129-04:00To Sell or Rent?With a down market, homeowners are wondering whether they should sell their houses or rent them out and wait for the market to rebound. Stated in another way, is the investment value higher than the market value? Market value is the price a typical buyer will pay for your property. Investment value depends on an individual’s financial situation, risk preference, and the ability of the property toAnwell Tsaihttp://www.blogger.com/profile/06467915229761268438AnwellTsai@gmail.com0