My wife and I are first time home buyers, we recently got pre-approved for a mortgage, and we just started looking for our first home. So far, it has been an exhilarating but daunting experience. Despite the availability of the various tools and resources we are a little overwhelmed and that is one reason why I came to this forum for some insight.
After reading most of the posts on this real estate forum, I haven’t decided if I should thrilled or depressed about the information posted here! I am leaning towards being depressed.
This is (I hope) and accurate summary of what I have read…
In MA, assessed rates for 2011 are based on 2009 values. Meaning, the assessed value we see on websites are from 2009 and do not accurately reflect the current assessed value of the home.
The above assumes no improvements have been made on the home during the past few years. Improvements will (hopefully) add to the value of the home and should be factored into your asking price. Assuming, of course, they are, in fact, improvements and you can verify the construction occurred during the past two years.
Why would anyone look at or even buy a home today that is above the assessed value knowing that the assessed values will decrease next year and they will decrease even further when 2011 is published in two years? This means as soon as you buy the home you will, minus the down payment, owe more then your home is worth. In addition, unlike the 90’s and early 00’s, home values might continue to fall.
Why would anyone list their home in this market unless they had to?
Someone posted that you should not use the assessed value, Zillow, or similar tools when determining the value of a home (perhaps a seller or an agent posted that). You should rely solely on similar homes in the area that recently sold and only then can you evaluate if the list price is reasonable. Well, you can’t really rely on that either because you have no way of knowing if the buyers were diligent during the purchasing process.
It is a myth that sellers pay the agent fee. The seller inflates the price of the home to cover the cost of commission. Therefore, the buyer really pays the fee.
The appreciation of home values we witnessed during in the past decade or so will probably never happen again.
Not happy to hear real estate agents being compared to used car salesman. I thought RE agents were the “good guys.”