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October 2007 |
A Publication of ELLIOTT®
& Company Appraisers |
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STUDY
NAMES TOP REBOUNDING METROPOLITAN AREAS |
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 While home
prices in many areas of the United States are stagnant and even falling,
there are also quite a few areas where housing-value experts feel that a
home purchase is an investment that should quickly pay dividends. A
study by Business 2.0 magazine and Moody’s Economy.com determined the
top 10 metropolitan areas that it concluded were the best places for the
average home to increase in value.
Those areas are: (1) Dallas-Fort Worth, (2) Indianapolis, (3) New
Orleans, (4) Atlanta, (5) Montgomery, AL, (6) Memphis, (7) Mobile, AL,
(8) Austin, TX, (9) Houston and (10) St. Louis.
It is interesting to note that all 10 of these metropolitan areas are
either in the South or the Midwest. These areas did not, as a whole, see
gigantic advances in housing prices during the earlier half of the
decade, as housing prices were booming in other areas. Now, as the
former booming areas are going through a period of price correction,
these southern and midwestern areas are positioned for price growth. The
percentage of increase in average home value for these areas, from the
first quarter of 2008 through the fourth quarter of 2009, range from
6.4% (Dallas-Fort Worth) to 4% (St. Louis).
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HOUSE
VOTES TO OUTLAW ‘IMPROPERLY INFLUENCED APPRAISALS’ |
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 As part of
FHA reform legislation, the U.S. House of Representatives passed the
Expanding American Homeownership Act (H.R. 1852).
An amendment by Rep. Barney
Frank, chairman of the House Financial Services Committee, outlaws
mortgage loan originators from doing anything to "compensate, instruct,
induce, coerce, or intimidate [an appraiser] for the purpose of causing
the appraised value assigned to the [collateral] property under the
appraisal to be based on any other factor other than the independent
judgment of [the appraiser] exercised in accordance with applicable
professional standards."
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RISKS MAY BE
DECLINING FOR HOME-PRICE DROPS |
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The PMI Mortgage Insurance Company
Fall 2007 Market Risk Index reported that the number of areas at
risk for declines in home prices has fallen. Of the 50
metropolitan areas covered in the study, 11 were determined to
have a greater than 50% chance of having their average home
prices drop. There were 15 such areas in PMI’s summer report.
Home affordability increased in all but two of the top 50 MSAs.
"Home-price-appreciation rates have slowed significantly and have
gone negative in some areas," said Mark Milner, PMI’s chief risk
officer. "In order to restore a healthy market balance, prices
need to come back in line with incomes."
Risk of home-price decline is highest in California, Florida and
the Las Vegas and Phoenix MSAs.
"We found that owning a home for 10 years during [the last 25
years] was a good strategy to build wealth and increase net worth
over the long term," Milner said. "The market’s changing tide
doesn’t necessarily mean it is a bad time to buy or own a house,
but it is a reminder that home ownership is a long-term
investment." |
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QUOTES OF WIT &
WISDOM |
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 "Like
an ability or a muscle, hearing your inner wisdom is
strengthened by doing it." -- Robbie Gass
"We have been taught to believe that negative equals
realistic and positive equals unrealistic." --
Susan Jeffers
"The first and most difficult risk we can take is to be
honest with ourselves." -- Walter Anderson
"Work saves us from three great evils: boredom, vice and
need."
-- Voltaire
"I believe that a scientist looking at nonscientific
problems is just as dumb as the next guy."
-- Richard Feynman
"Men occasionally stumble over the truth, but most of them
pick themselves up and hurry off as if nothing ever
happened." -- Winston Churchill
"A goal without a plan is just a wish." -- Antoine
de Saint Exupery
"In case you’re worried about what’s going to become of the
younger generation, it’s going to grow up and start worrying
about the younger generation." -- Roger Allen
"I’m tired of all this nonsense about beauty being only
skin-deep. That’s deep enough. What do you want, an adorable
pancreas?" -- Jean Kerr
"Against logic, there is no armor like ignorance."
-- Laurence Peter
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