Recap: Valuation Expo 2021

As a southern California property appraiser, each year I attend Valuation Expo, the country’s largest trade show for real estate appraisers. It’s an incredible forum for learning, networking, and gleaning insights and forecasts on the future of the real estate market. This year’s expo at the Bellagio in Las Vegas was a brilliant collaboration on ideas and forecasts!

So what’s the consensus, you ask? The country’s largest lending institutions, real estate corporations, and appraisal management companies (AMCs) are each aligned this year in their projections that the housing bubble and prime seller’s market we’re currently experiencing is headed for a substantial correction. And soon! (Nothing like the correction and recession of 2008 expected, but notable, nonetheless.)

And what does this mean for the economy? Buyers and sellers? Realtors and Property Appraisers? Interest rates? Stock and bond markets? The construction industry? All that remains to be seen, and the next several months will no doubt involve disparity and some distressing fluctuations. But they’ll eventually deliver lucidity — allowing buyers, sellers, agents, appraisers, and lenders to plan and budget accordingly. After all, the past few years have seen price spikes and bidding wars that are unprecedented, and corrections are critical for long-term market stability.

So please stay calm, carry on, and plan accordingly. The housing industry may be headed for a significant adjustment, but as the great Helen Keller once said, “A bend in the road is not the end of the road, unless you fail to make the turn.”

Bidding Wars Fall to Lowest Levels Since 2020 -MSN article

Housing Crash 2021 Starts Here -Reventure Consulting

Home Listings Surge. Bubble Over? -Reventure Consulting

Click here for tips on maximizing the value of your home and other frequently asked questions on the property appraisal process.

Home Values Top $530K in Riverside County’s Real Estate Market

Photo by Matthew LeJune on Unsplash

Sellers rejoice! Buyers — maybe not so much. According to Realtor.com, home values in Riverside County have increased a whopping 18.8% since July of 2020, and are selling for an average of 1.43% over asking price. On average, homes are selling after just 48 days on the market, and the Sellers Market we are experiencing in southern California is not expected to change anytime soon.

There were about 10,500 homes for sale in Riverside County in July. Rancho Mirage topped the July 2021 Realtor.com Median Listing Price report at $765,000, while Desert Hot Springs brings in the lowest listing price at $348,500.

COMMUNITY: MEDIAN LISTING PRICE

Beaumont: $465.3K

Canyon Lake: $649K

Cathedral City: $434.9K

Chiriaco Summit: $449.9K

Corona: $650K

Desert Hot Springs: $348.5K

French Valley: $599K

Hemet: $375K

Indio: $475K

Jurupa Valley: $550K

La Quinta: $675K

Lake Elsinore: $524K

Menifee: $499.9K

Moreno Valley: 465K

Murrieta: $600K

Norco: $749K

Nuevo: $510K

Palm Desert: $494.9K

Palm Springs: $619K

Perris: $459.9K

Rancho Mirage: $765K

Riverside: $551K

Sage: $412.5K

San Jacinto: $401.8K

Sun City: $365K

Temecula: $693.9K

Wildomar: $582.5K

Winchester: $572.5K

Hosking Appraisal Group provides home valuation services throughout Riverside County and southern California’s greater Inland Empire. To schedule an appointment or for more information, call us at 951.294.1955

Home Values in the Riverside County Real Estate Appraisal Market

Riverside County, California

As a licensed Riverside County Real Estate Appraiser, Hosking Appraisal Group valuates homes in dozens of communities throughout the Inland Empire Property Appraisal market. This vast southern California region spans a whopping 4,850 square miles, and over 17,000 homes are currently on the market in Riverside County alone. And depending on location, home condition/upgrades and a variety of other economic factors, average residential property values are remarkably diverse. For instance, the home value based on Hemet real estate appraisals averages just over $233,000 while Corona real estate appraisals calculate average home values around $426,000:

Riverside County Average Home Value Statistics 

Based on 2016-2017 Market Research (Values are approximate to the nearest $1,000)

Canyon Lake Property Appraisal: $374,000

Corona Property Appraisal: $426,000 (highest)

Hemet Property Appraisal: $233,200 (lowest)

Lake Elsinore Property Appraisal: $312,000

Menifee Property Appraisal: $339,000

Murrieta Property Appraisal: $386,000

Perris Property Appraisal: $266,000

Temecula Property Appraisal: $421,000

Winchester Property Appraisal: $380,000

 

Busting 9 Myths About Property Appraisals

Property Appraisals vs Home Inspections

There are plenty of of assumptions about property appraisals circulating among home buyers and sellers, and many of them simply don’t hold any merit or truth. Licensed property appraisers must adhere to a code of strict regulations called the Uniform Standard of Professional Appraisal Practices (USPAP), and are congressionally mandated – regardless of location. Here’s a list of nine myths about the appraisal process, and the actual facts behind them.

Property Appraisal FactorsMyth: An appraisal is the same thing as a home inspection.

Fact: An appraiser provides an informed opinion of a home’s value through a comprehensive appraisal process based on factors including location, condition and improvements, amenities, and market trends. A home inspector determines and reports on the condition of a home by assessing its main components including (but not limited to) roof, electrical, and plumbing systems.

Myth: The appraised value of real estate property can vary, based on whether it is prepared for the seller or buyer.

Fact: An appraiser has no stake or vested interest in the outcome of an appraisal, and is mandated to provide his/her valuation services with impartiality and neutrality.

CalculationMyth: Real estate appraisers utilize a generic formula based on ‘price per square foot’ to determine a home’s value.

Fact: Appraisers analyze a number of factors associated with the value of a home. Some of the factors include a property’s location, size, overall condition, proximity to various facilities, and the recent sales price of comparable homes in the market area.

hag-imageMyth: Property appraisers only estimate real estate/property value when a home sale involves a mortgage or lending transaction.

Fact: Depending on his/her qualifications and certifications, a property appraiser can provide property valuations for several other purposes. These valuations can (and often are) be for the purpose of dispute resolution, divorce, estate planning, bail bond purposes, zoning/tax assessment reviews, Private Mortgage Insurance (PMI) removal, and cost/benefit analysis.

Myth: A property’s market value should equal the replacement cost.

Fact: Market value is based on what a buyer would likely pay the seller for a particular property, factoring in that neither party is under pressure to buy or sell. Replacement cost is a determination of the dollar amount that would be required to reconstruct a property in-kind.

Economic conditions

Myth: In a healthy economy when the sales price of homes in a specific area are rising by a specific percentage, the value of individual properties in that area can be anticipated to appreciate along that same percentage.

Fact: The value appreciation of a singular property must be determined on an individual basis. The appraised value includes a variety of relevant components (including the sales price of comparable properties in the area), regardless of economic trends.

Appraisal ComponentsMyth: The assessed value of a property should equal the market value.

Fact: Many states actually support this concept; however, this is not always the case. If other properties in the area haven’t been re-assessed for a protracted period, or if the interior of a home has been remodeled and an assessor is unaware of those improvements, the assessed value of a home may very well differ from market the value.

Myth: Consumers own their appraisal because they are the ones who pay for it when applying for a loan to purchase or refinance their property.

Fact: Unless a lender “releases interest” in the document, appraisals are owned by the lender. However, the Equal Credit Opportunity Act allows that consumers can order a copy of the appraisal report from the lender who ordered it.

Review your real estate appraisalMyth: A home buyer or seller doesn’t need to be informed about what is in an appraisal document as long as it meets the needs of their lender.

Fact: Consumers should confirm the accuracy of their appraisal document, and if needed, question the results. Appraisals include a legal and physical description of a property, including precise square footage and property lines. They also include a list of comps (comparable properties) in the neighborhood and market trends in the vicinity, making them valuable for future reference.

There’s a New Feather in Hosking Appraisal Group’s Cap

By Michael Hosking, Senior Appraiser

 

As a proud veteran of the US Navy, I’m honored and humbled to stand with veterans and current military personnel serving all branches of the US Armed Forces. The freedom we Americans enjoy – and often take for granted – has been bought and paid for by the blood, grueling commitment, and sacrifice of millions of American men and women.

So when the opportunity arose to apply for admission onto the VA Appraisal Panel (the most difficult appraisal committee to be accepted onto in property valuation), I was again honored to begin the process.

Residential Property Appraiser

In order to become a VA Fee Appraiser, Hosking Appraisal Group must be considered one of the highest quality residential real estate appraisers. An appraiser cannot simply request to be on the panel in order to gain access. It takes excellence in business. As senior appraiser and president of Hosking Appraisal Group, the buck stops with me. We’ve spent 15+ years submitting accurate, top-rate residential appraisals for every client. Appraisals are thoroughly analyzed by our team before they leave our office, and they’ve been delivered on-time every time.

US Navy Veteran logoThe certification/continuing education process for a California property appraiser is ongoing, even grueling at times. Hosking Appraisal Group is – and always has been – current with the latest certifications, modifications, and changing legalities in the appraisal process. Our goal is to be the highest quality residential property appraiser in the Inland Empire. We’re proud of our efforts. We won’t stop until we’re there. And we’re now one step closer …

As a member of the VA Appraisal Panel, I am once again honored and humbled to help my fellow veterans. This time it’s off the base and battlefield; it’s at home.

The Inspection Industry is Flying High and Here’s Why

By Michael Hosking, Certified Residential Real Estate Appraiser

Feature Photo courtesy of Geek on Gadgets

One would assume that it’s only a matter of time before drones, the hottest tech gadget on the planet these days, become a useful tool in property inspections. Well the time is here, and the inspection business is flying high!

According to an article published on November 4, 2016 by Fox Rothschild LLP, the FAA is working fast and furious to grant special permits for drones in business – over 4,000 have been issued for the commercial use of “Unmanned Aircraft Systems” (UAS)  to-date. And drone use is revolutionizing the way many industries are advancing their business. Insurance companies like Allstate, USAA, State Farm, and AIG have all taken to the skies for the inspection of properties that are unsafe or difficult to reach. This translates to lower risks for inspectors and quicker payments for insurance customers, a win-win all around.

Photo courtesy of Popular Science
Photo courtesy of Popular Science

Naturally, UAS permits come with restrictions. Commercial drone use near airports, high-density housing communities and urban areas is prohibited, as is night-time flying. Permission by property owners is also required, But regardless of the restrictions, one thing is certain: the use of drones – whether in real estate, insurance, or telecommunications, has already made a profound impact on the business of inspecting, and the fun has just begun.