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March 2006 |
A Publication of ELLIOTT®
& Company Appraisers |
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TEN
PRICIEST ZIP CODES FOR HOUSING IDENTIFIED |
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 Forbes.com
has released a list of the top 10 ZIP codes in terms of highest
average housing prices.
The ranking was done with the research of OnBoard, a company in New
York that specializes in data collection, Miller Samuel, a real
estate appraisal and consulting firm, and the National Association
of Realtors.
The study concluded that the most expensive ZIP code in the United
States, based on the value of the average house, was 94027 in
Atherton, CA, where the median house price in 2004 was $2,496,553.
Atherton is located in the Menlo Park area near San Francisco.
Coming in second on this exclusive list is ZIP code 93108 in
Montecito, a suburb of Santa Barbara in southern California, with an
average home value of $2,176,521. Third was 92067 in Rancho Sante
Fe, CA, at $2,144,254. It was one of two ZIP codes in the San Diego
County town. No. 4 was 92662 in Newport Beach, CA, where home values
averaged $2,046,577.
The highest ranked ZIP code outside of California was 11765 in Mill
Neck, NY, a town of about 850, located just north of the Big Apple,
where home values average $1,948,366. Coming in at No. 6 and the
lowest California ZIP code on the top 10 (That’s right; Beverly
Hills 90210 didn’t make it.) was 94967 in Ross, a Marin County
suburb of San Francisco where home values average $1,910,263.
Lucky No. 7 was ZIP code 89402 in Crystal Bay, NV, where home values
averaged $1,806,962. This ZIP is in the Lake Tahoe area. No. 8 was
07620 in Alpine, NJ, where the median home value was $1,773,180.
Alpine is about 2.4 miles from Yonkers, NY. Ninth was 89413 in
Glenbrook, NV, not far from Crystal Bay, where the medium home price
was $1,765,000. Rounding out the top 10 was 07976 in New Vernon, NJ,
near Morristown, where the median home value was $1,760,000.
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STUDIES REVEAL
SIGNIFICANT HOME-PRICE INCREASE IN 2005 |
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 Two
independently conducted studies revealed significant home price increase
throughout the United States last year.
According to the National Association of Realtors (NAR), the median
existing single-family home price in this country rose from $187,500 in
the fourth quarter of 2004 to $213,000 in the fourth quarter of 2005,
for a gain of 13.6%. Meanwhile, the Office of Federal Housing Oversight
reported that the average home price in this country grew by 12.95% last
year. The OFHEO study also reported that prices of other goods and
services increased by only 4.3% last year.
The median price is not the average price. Instead the median price is
the one in the middle, where half of the homes sold for more and the
other half sold for less.
Actually, the fourth quarter results of the NAR survey showed that
home-value increases were slowing down. The annual rate of home-price
appreciation derived from NAR’s third-quarter survey in 2005 showed a
14.7% growth in median single-family home price.
"Although home sales have eased, the tremendous momentum in price
appreciation was sustained in the fourth quarter because tight
inventories still favored sellers," said David Lereah, chief economist
of NAR. "The good news is that the supply of homes on the market has
been trending up and we are entering a
period of a more normal balance in supply and demand."
"While deceleration continues in some areas, appreciation is still
extremely strong," said Patrick Lawler, chief economist of OFHEO.
"Mortgage rates climbed significantly during the second half of last
year, but the effect of that increase on price appreciation, so far,
appears to be limited."
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HOMES BECAME MORE
AFFORDABLE IN LAST 10 YEARS |
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 Despite
rapidly rising home prices in the last few years and recent
public concerns over the scarcity of affordable housing, a
report published by Moody's Economy.com indicated that housing
in the United States has actually become more affordable during
the past decade.
The report said that the percentage of a household's income
needed to meet mortgage payments had dropped to 22% in 2005. In
2002, this figure was 30%. Reasons cited for the improvement in
housing affordability include low interest rates, increasing
incomes and a greater housing supply.
The most unaffordable areas of the country for housing were New
York City, Chicago, Boston and coastal California, where the
percentage of income needed to buy a house averaged over 40%,
according to the Moody's report. |
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APPRAISAL
ALLEGATIONS EXPENSIVE FOR AMERIQUEST |
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 Ameriquest
Mortgage Co., the largest sub-prime lender in the United States,
recently agreed to a $325 million settlement after being accused
of faulty lending practices, including "improperly influenced
and inflated appraisals."
Restitution to the consumers throughout the country, who claimed
they had been bilked by Ameriquest’s lending practices,
accounted for the bulk ($295 million) of the settlement. The
other $30 million will go to 49 states and Washington, DC, in
order to cover the costs of their three-years' worth of
investigation into these charges brought on by the irate
borrowers.
While not admitting to any wrongdoing, Ameriquest has announced
it will do things differently in the future. One major change in
Ameriquest's procedures appears to be centralizing its
collateral property appraisals, which will keep its loan
officers from influencing the appraisers. |
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COSTS OF BUILDING
HOMES ARE INCREASING |
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 Due
to the increased prices of materials, as well as rising energy
costs and interests rates, the costs of building homes are also
going up.
The National Association of Home Builders reported that
building-material prices grew about 10% in 2005. The prices of
concrete and PVC pipe rose at a significantly higher rate due to
the high demand for these materials in the wake of Hurricane
Katrina.
"There is an age-old misconception by the buying public, who
think that the home builders are making these enormous profits,"
Dallas-area homebuilder Michael Mishler told the Dallas Morning
News. "I'm here to tell you that's not the case. The profits are
very minimal and hard to increase."
Builders of lower-priced housing are finding this inflation the
most difficult.
"At the lower end, under $175,000, we are not seeing as much
ability to pass on these costs," said David Brown of Metrostudy
Inc., a housing analysis firm. |
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QUOTES OF WIT &
WISDOM |
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"To acquire knowledge, one must
study; but to acquire wisdom, one must observe."
-- Marilyn vos Savant
"The two most common elements in the world are hydrogen and
stupidity." -- Harlan Ellison
"If we take care of the moments, the years will take care of
themselves."
-- Maria Edgeworth
"A healthy male adult bore consumes, each year, one and a
half times his own weight in other people’s patience."
-- John Updike
"Poverty is the parent of revolution and crime." --
Aristotle
"A painting in a museum hears more ridiculous opinions than
anything else in this world."
-- Edmond de Goncourt
"Don’t complain about growing old. Many people do not have
that privilege." -- Earl Warren
"Everything you can imagine is real." --
Pablo Picasso
"It is impossible to defeat an ignorant man in an argument."
-- William McAdoo
"Courage is the art of being the only one who knows you’re
scared to death." -- Harold Wilson
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