Posted by Bill Mooney on November 02, 1998 at 22:53:02:
Don’t make this that difficult.
Drive the area. Take down numbers off Realtor for-sale signs and call up the realtor. Ask them how they arrived at the asking price (which sales did they use) and take down the information.
Let them know you are looking at a property to buy in the area and want to know if it is the right price. Don’t let them know the address…they’ll be your competition. Let them know you might be reselling and are looking for an agressive realtor.
The rest…cinchy.
Don’t forget to get the MLS listing sheets. They disclose good information like how long the comparables took to sell, condition, amenities etc.
Posted by Michael (NM) on November 02, 1998 at 14:12:04:
I have not cultivated a relationship with a realtor in my area to provide comps. The realtors want $100 to run CMAs.
The online comps do not have my area in their database.
Will the county assessor have these figures or will they just list mortgaged amounts? Is there a way to get comps without forking out $100?
Thanks
mh
CLASSIC CASE…WRONG NUMBERS!!! - Posted by JOHN(MA)
Posted by JOHN(MA) on November 04, 1998 at 09:54:25:
A very strong argument for NO TO TAX VALUATION…
In my area, more than three towns have had problems
with the “Contractor” who has done the valuations.
The valuations have been done sent out recorded and
repealed by a special law. What would you say to this
scenario; Town has record “Two family, 45000sq ft lot
asessed at 72,000,etc,etc”. Real life shows this is a
single family, lot size 43,250sq ft,etc,etc.
Just a boondoggle of HUMAN/COMPUTER ERROR…This couldhappen to YOU…I personally never use tax valuations for other than an IDEA OF TAXES.
Comps is comps, your comparing the RE your looking at to RE that has most recently sold in your immediate area that matches as closely as possible in every way. Keep reading and understand this site as it is better than anything you could learn at Harvard…“What they never taught me”
Several recomendations:
First, as stated by my experienced friend Phil, never rely on assessed values. Leslie had good parameters, but checking the comps for conformity to the subject property is crucial. Many “comps” can be in superior or inferior condition or location. A house ON the beach can be worth twice the value as property across the street, etc. Only use property listed by an agent as substaintiating other sources. Remember the seller and agent establish the list price and their goal, typically, is to get as much as possible. Additionally, most sellers ask a higher price so that they have room to negociate. If your area has not appreciated nor depreciated in a period of time use that period (if necessary) to get comps that are in the same tract/model/square footage as the subject property. The idea of paying $100 for a CMA is extortionary. You could almost get a certified appraisal for that price. I am a RE broker on the MLS and I can run a CMA before my coffee is finished percolatin
Posted by Leslie(AZ) on November 03, 1998 at 22:22:47:
Recent ‘sales’ (6-12 mos) are what you’re looking for. You only need about 3-5 of them. They should meet at least 3 criteria. 1)It must have been ‘sold’ to even qualify, the most recent sales will carry the most weight 2)The homes should be within the same area (I probably wouldn’t go further out than 2-3 miles), as long as the area doesn’t change dramatically. The closer the better. 3)They should have about the same square footage (usually not more than about %10 either way). This will help you get the best assessment of your prospects.
TRy your friendly neighborhood title company. Ours will pull apparent comps for free - tho I then use my own knowledge of the area to determine which are true comps.
But I agree with the others that your own experience will be you safest guide,
Good luck.
Carol
Posted by phil fernandez on November 02, 1998 at 16:10:49:
Michael,
What ever you do , do not rely on tax assessments to determine fair market value. This could get you in big trouble. These values are not fair market values.
Posted by Tom Brown on November 02, 1998 at 14:54:00:
$100 to perform a CMA? Could you just get the printouts on the sales and do the work yourself? It isn’t hard, it just takes a little experience.
Your courthouse should have the recent sales and prices for your area. In fact, many local newspapers publish real estate sales once a week or so.
You can get a ROUGH (Did I say ROUGH, I mean ROUGH) idea of property values by looking at the value the tax assessor puts on a property. I mean ROUGH because properties are reassesed every 4-5yrs unless there is a sale of the property. Also the method used is a little different than the method used in the CMA.
Your best bet in the end would probably be to find a friendly realtor though. If you can’t, a last resort would be to get your license and join a firm just to get access to the MLS. The cost in the long run may end up being less than what you would have to pay to have another realtor pull comps at $100 each.
Posted by Redline on November 02, 1998 at 15:30:29:
Firstly, when you say $100 for comps I believe what you’re saying is … for $100 a realtor/broker will sit down and spend a couple of hours researching recent sales and put together a report on the property in question and assign a FMV. Not too bad considering. You could research yourself but this takes time and a little experience. Both these things cost money in thier own way.
To comment on the above, I would not consider what the tax assessor’s numbers were AT ALL. These numbers often have little or no basis in reality and using them could really land you in trouble.
Lastly, work with a local realtor (part-timer even) not a broker. I say not a broker because a broker may be more inclined to charge a fee because it’s their business and they are often very busy and want to get paid for their time. It’s sometimes easier to find a hungrier salesperson. Form some kind of relationship with him/her. If you tell them what you want to accomplish and offer to not forget them when you want to sell your investments, they’ll probably do a quick-and-dirty comp for you for free. I probably would. Give it a shot.
Posted by Tom Brown on November 02, 1998 at 16:16:53:
Paying a realtor $100 for a CMA is a quick fix but in the long run you will be farther ahead if you learn to do it yourself. Why? You will learn your market. I worked in an area for 10 yrs. I could drive into most areas of the city that I was interested in and eyeball the value of a house to within 5-10%.
I could also use the tax assessor’s numbers because I knew what the difference was between FMV and the assessor’s FMV for my area. I knew that in general it was going to be 12-15% low. That put me in the ballpark when I was looking at a lot of properties and trying to prioritize things. It won’t work everywhere and really shouldn’t be used as more than a rough estimate, which is why I repeated the word rough three times. (This also worked because the neighborhoods I was looking at were large compared to most–several hundred homes–which lends itself to a more accurate picture using the averaging techniques that most assessors use.)
Posted by Redline on November 02, 1998 at 19:49:55:
I understand where you’re coming from, but I still think using tax numbers for FMV is bad bad bad. (Three times as well). I’ve seen numerous occassions where (depending on who the builder was, or who owned the property) the tax numbers were WAY off on properties.
I’ve found more irregularities than the opposite.
I believe for the most part there are too many factors to figure in to equate tax numbers and FMV. You may have found one area that proved me wrong. But for new guys/gals I don’t consider it good advice.