Msrcc55, Home Buyer in Newbury Park, CA

Why is it that when an estimate is figured, it is not done comparing similar properties, but includes attached and manufactured homes under the?

Asked by Msrcc55, Newbury Park, CA Sun May 16, 2010

heading of "single family residence"? This is very deceiving and it only brings down the average prices of a neighborhood of similar homes!

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6
Bonnie Sterl…, Agent, Simi Valley, CA
Mon May 17, 2010
Hi Msrcc55,

I see a lot of agents answered your question trying to guess about whay you meant by when an estimate is figured. I think I would want to know which estimate to answer your question mindfully. Was is an appraisal, a Realtors estimate, a lenders estimate (sometimes they use a service that gives them a range for what the appraisal might come in at) or an appraisal. Share more please.
0 votes
Ted Mackel, Agent, Simi Valley, CA
Mon May 17, 2010
Msrcc,

Currently there a three methods used to determine the value of a property. Broker Price Opinion (BPO), Comparative Price Analysis (CMA) and an Appraisal. Lenders give the highest credibility to an Appraisal.There is really not much difference between a CMA & BPO, these or done by real estate agents. The form or the format might be different but the information is still the same.

Briefly if you want to gain a quick understanding of the value of your home the main questions asked when finding a value are:

Properties of similar size, age, bedrooms, bathrooms and amenities.
Condition of all properties compared (i.e. deferred maintenance versus well-maintained)
Location of all properties compared ( i.e busy streets versus interior neighborhood locations)
Distance of all properties compared (typically 1 mile unless here are special circumstances)

You are going to need at least three sold properties within the last six months and three active properties for sale to come up with a justified value.

The three methods I mentioned above are going to be the most reliable in determining a value for a piece of property. Are they perfect? No, but you have to realize that agents that prepare poor CMAs & BPOs do not stay in business long or will not be called back for more valuations in the future. Appraisals tied to a loan have some very serious consequences if they are deceiving or incorrect, one being Federal Loan Fraud.

Valuations that come from Internet websites have no performance pressure on them. These valuations are helpful but not reliable. I have yet to see an Internet real estate information provider write an algorithm that can take in all the variables and exclude improper variables to zero in on a value. it still takes a human to look at the data and make the proper adjustments. What many people don't understand is that the computer cannot see inside those houses. Upgrades, lack of upgrades, deferred maintenance and location are items that real estate computer valuation programs have a hard time accounting for. The public record and even MLS systems many times don't provide enough detail. If the detail isn't there for every single piece of property, how can you expect any online website valuation tool to be accurate? You still have to get a body on the property to see and make the proper adjustments.

There was some talk about Zestimates and I like Zestimates. I am not saying that they are particularly accurate but you can use these as a tool. I have several client's properties that are not currently for sale and my own properties set up with value alerts. I get an e-mail from Zillow when Zillow's system perceives a change in value for any of those homes. As a real estate professional I can then look closer at the information and determine what is happening in those areas. I have seen Zillow Zestimates come in right on the money, sometimes high, but many times come in low too.

I posted a video commentary on valuations on my blog
http://homebuysblog.com/2010/03/11/impacting-home-values-is-…
Web Reference:  http://www.homebuysblog.com
0 votes
Pat & Steve…, Agent, Westlake, OH
Sun May 16, 2010
MSrcc55:

You should contact a local real estate agent to assist you. The agent will do a Comparative Market Analysis ("CMA") at no cost to you. The CMA will give you homes that are comparable to yours, both those that have sold in the last 3 to 6 months and those that are currently on the market.
0 votes
Heidi Golff, Agent, Ventura, CA
Sun May 16, 2010
Heidi Golff
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Hello Msrcc55,

Zestimates done by an automated computer system cannot take the place of a local knowledgeable real estate professional in your area. I have a $1,850,000 listing that when compared by zestimate, should be at $850,000. That is a full million dollars off base! The diversity of properties within certain neighborhoods, let alone zip codes, makes it a wise move for you to speak with someone who can zero in specifically for you.

Personally, I think I am safe in saying that most of us in the real estate profession consider zestimates and similar products to do more harm than good!
0 votes
Barry Shapiro, Agent, Camarillo, CA
Sun May 16, 2010
Hello Msrcc55,
This is an excellent question. The term "estimate" is not used in true real estate negotiations or for a lender's APPRAISAL. An appraisal would not include an attached home or manufactured home, as long as there is inventory of recent comps (SOLDS, pending, and actives) to support the appraiser's analysis. Learn to ignore the "Zestimate" for your home's value. Turn to a real estate pro that knows your neighborhood. We have two agents on our team that LIVE in Newbury Park, and can assist you with purchasing or selling property in the Conejo Valley. Good luck!
0 votes
Joe Arnao, Agent, Sanwich, MA
Sun May 16, 2010
That often happens when an agent enters the property into the mls system. Some systems don't provide specific categories for these types of homes and the fall in the single family slot. If you want an accurate analysis, you should seek out a quality real estate agent who will sift through the data and come up with a more realistic number.
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