Real Estate Appraiser

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Yesterday I wrote about the Plumas Lake real estate market, and since I inspected a property in Olivehurst today (just north of Plumas Lake), I figured I’d include a few supplementary images of the area.

This photo was taken today in the southern portion of Plumas Lake (Cresleigh Meadows / Plumas Ranch). Vacant residential lots are commonplace these days and seen in the Plumas Lake area and throughout the Sacramento Region in many cities and counties.This vacant lot is located right across the street from a brand new park, and I loved the contrast of residential cables, brown grass and grazing sheep. 

plumas lake

Many newly constructed communites have “coming soon” signs for future residential and commercial construction. In general there is not enough profitability for local builders at this time, so postponed construction during the economic downturn is very standard protocol. Just think of how many jobs (and excited residents) there will be when the economy turns around and building can resume.

plumas lake 2 Sheep in Plumas Lake: Photos from the Field


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While on an appraisal inspection in Los Banos this morning I made a pit stop to a local “Fotomat” style coffee shop to re-fuel. I’ve noticed this little java hub over the past several years, but never actually stopped, so I figured I would become a customer today.

FotomatI don’t know about you, but little drive-through businesses like this remind me of the small blue and yellow photo huts in years past. Do you remember “Fotomat“? Though I doubt Cafe E Via was formerly a Fotomat (too big), this shop is definitely similar in concept. In fact, when I see old Fotomats from time to time, it seems the most predominant use is a coffee shop. Maybe that’s the highest and best use? What do you think? What is the most successful type of business you’ve seen using a former Fotomat building? Did you used to shop at Fotomat?

043 “Fotomat” Coffee Shops: Photos from the Field


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I wrote previously about the “Bursting of the Duplex Market in Sacramento“, so I figured I’d also provide a graph of the fourplex market so we can see visually what has taken place over the past three years in Sacramento County. Yes, I know Sacramento County is a large territory representing many neighborhoods and sub-markets, but I think this trend graph tells a story nonetheless. All blue dots below are sales based on data in Sacramento MLS.

Quadruplex Fourplex Sales in Sacramento County November 2006 to November 2009 Trend Graph by Lundquist Appraisal

Isn’t it amazing to see the impact of the housing bubble burst? Three years ago many quadruplex units in Sacramento County were selling between $400,000 to $600,000, but the bulk of sales lately have been easily hovering around $200,000 +/- or lower. With prices so low right now, many investors have understandably been purchasing 4-plex units. The ideal scenario would be to pick up a quadruplex, have postive cash flow, and then re-sell the property in a number of years when the market turns around.

I actually just finished a property tax appeal for an investor who purchased a fourplex in late 2009 for under $200,000, but the Assessor still had his property valued in the high $300,000s. He is scheduled to pay over $1,000 too much in property taxes this year because the Assessor’s records are not consistent with realistic trends in the marketplace. This is a common problem for so many properties that sold near the top of the market and are now re-selling in today’s market.

Let me know if you have any questions. Comments are welcome. Ryan 916-595-3735.

www. The Crashing of the Fourplex Market in


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What sort of a price difference is there between bank-owned properties (REO), short sales, and arms-length transactions in the market? For an example, let’s take a look at a trend graph of all sales in Rancho Cordova below, where blue dots are REO sales, green dots are Short Sales and red dots are typical arms-length sales (per Sacramento MLS).

Rancho Cordova Sales REO Short Sale Typical Trend Graph by Lundquist Appraisal November 2009

Each neighborhood, niche, and location will differ in results, but generally speaking, like the data above seems to show for Rancho Cordova sales over the past 2 years, buyers tend to pay more for houses that are non-distressed transactions (notice how the red dots on the graph above tend to be located toward the top and NOT the bottom). When it comes to REO properties, it looks like the price level is a bit higher overall than short sales, though there are quite a few short sales on the upper-end of the market too. In fact, both Rancho Cordova and Sacramento County saw a 7% increase in short sales last year in comparison to the year before, so clearly there is a greater acceptance for short sales in the marketplace.

fixer-property-lundquist-appraisalOne important observation is that most of the sales at the bottom of the market are bank-owned. Why is that? Investors typically gobble up the lowest end of the market with all-cash offers because fixer-type properties at the lowest level will not qualify for conventional or government financing. This means first-time buyers utilizing conventional or FHA financing will usually need to look to a price level above the “all cash” market. In light of this segmentation, imagine scraping off the bottom layer of all-cash foreclosures. What would you find? You’d still see many REO properties, but you’d certainly see a good amount of Short Sales too. 

Overall, in my experience as a Sacramento-area real estate appraiser it seems the market price tier goes: 1) Arms-length sale; 2) REO; 3) Short Sale. This is common sense really, but it’s another thing to prove that by crunching numbers, making trend graphs, and observing data in the marketplace. But there are certainly cases and stories and sub-markets that might show a different order for whatever reason - especially depending on the supply of housing inventory and particulars of a given property. Interestingly enough, sometimes there is little to no difference between non-distressed sales and REO sales. For example, what does it do to pricing differences when 90% of all sales in a market are either bank-owned or short sales? In a case like this, since the market is clearly saturated with distressed sales, it’s probably a safe bet to assume foreclosure-pricing is indeed the market and will set the pace for what buyers expect to pay for properties (see a previous post on Patterson having 96.5% of all sales as distressed). In a case like this, there may be no verifiable difference between REO and non-distressed sales.

Let me know if you have questions or insight. Comments are welcome. Is there a price difference between REO properties, short sales, and arms-length transactions?


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What’s been happening in the Gold River real estate market over the past several years? Gold River is a census designated place located just east of Rancho Cordova, south of the American River, and north of Highway 50. This HOA community has 25 separate villages and a combination of detached and attached housing – all single family residential. Gold River has the lowest unemployment rate in Sacramento County right now at 2.1% as of September 2009, but that does not mean that home values have been unaffacted.

Gold River Sales 2006 to 2009 Trend Graph by Lundquist Apprasial Company

What do you notice about the graph above? It looks like the upper end of the market above $550,000 has pretty much disappeared during 2009. It’s also evident that in the midst of a downward trend over the past several years that there have been few sales under $300,000. What else do you see? If you are a local Realtor or home owner in Gold River, what insight do you have into your market, and why is Gold River desirable to buyers in the marketplace (as a real estate appraiser, I love to hear people respond to questions like this)?

Gold River Real Estate Market Data:

  • 251 sales over the past 3 years
  • 62 sales over the past 12 months
  • 13 sales over the past 90 days
  • 11% of all sales over the past 12 months were REO (bank-owned)
  • 3% of all sales over the past 12 months were Short Sales
  • 29 current active listings
  • 13 current active short sale listings
  • 6 current pendings

The lower Western portion of the Gold River area is comprised of a subdivision called “Gold River Station”. Since Gold River Station is not a part of the Gold River HOA, it was prudent to look at data separately from Gold River. Sometimes outsiders to the area get confused about Gold River Station and therefore lump it in with Gold River, but it’s not a part of the Gold River neighborhood.

Gold River Station Sales 2006 to 2009 Trend Graph by Lundquist Appraisal Company

It’s not hard to see that there is a big value difference between Gold River and Gold River Station. Whereas there are few sales under $300,000 in Gold River, it appears that most recent sales in Gold River Station sold under $300,000. What else do you notice when comparing the graphs?

Feel free to contact me at 916-595-3735 or if you have any questions about the local real estate market or any appraisal needs. Gold River Market Trends: Past 3 Years of Sales


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Somebody asked me the following question the other day and I figured I’d post a response here.

Q: Could a location near a water tower impact market value for a home?

A: Maybe. Sometimes water towers are quite large and the typical buyer may not want to live right next to the tower. Let’s face it, some buyers simply wouldn’t want to look at an enormous tower every day, so they’d steer clear of such a location. If this was the case and most buyers felt that way, then there could be an impact on market value. On the other hand, there may be other buyers who would be unaffected by a water tower, or evidence to suggest that such a location makes no difference at all.


There is not a hard-and-fast water tower rule for appraisers to follow. There is no specific “water tower adjustment” that appraisers make in reports. An adjustment in an appraisal report would really depend on what data in the specific market was saying. Any adjustment should be based on the reaction in the marketplace. Is there any evidence in the market that buyers are willing to pay less  or more based on the location of a water tower? How do the most recent sales surrounding the water tower compare with sales further away? Does data show that there is really little to no impact on value?

Market conditions certainly play into the equation here too. If there is a vast oversupply of properties listed in the market, chances are someone might look to other listings first that maybe had a more typical view. However, in a market with very limited available properties, buyers may feel less concerned about such an issue and not consider a view of a water tower as a negative. After all, in a hot market with few properties to choose from, buyers tend to more easily overlook locational challenges (busy street, backs to commercial, located next to major fixer…) and even condition issues.

I don’t mean to be frustrating, but there is not really a straightforward end-all answer to the question that was posed to me. The answer really depends on your specific real estate market and what data in your local market says. My knee-jerk reaction is that most buyers would probably prefer to not live next to a water tower, but then again, it really comes down to what the data says because sometimes a real estate market is surprising and things that we think would make a difference in value don’t carry as much weight as we think (or none).

If you have any firsthand experience with a property near or next to a water tower, I’d be curious to hear what you have to say. Have you ever intentionally purchased a property near a water tower or away from one? Did you purchase a property near a water tower only to regret it later on? Is it just not a big deal for you at all? Feel free to comment. Question: Could a location near a water tower impact market value for a home?


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I recently came across some heavy duty security doors and steel window coverings in a certain area of Sacramento, and I was impressed with the overall set-up. Has anyone else seen these or used them before? These types of doors and window coverings are rented by the seller and used when selling a vacant property in an area that might have a need for such doors and windows for one reason or another. Access is keyless and is granted by using a particular sequential code.  


I haven’t seen steel doors and window coverings on many properties in the Sacramento area, but my guess is they are used sporadically at most, and probably at the discretion of the Listing Agent and bank. I can see doors as such being valuable for certain vacant properties since empty houses are often sitting ducks awaiting stripping of appliances, copper wire, cabinetry, fixtures, and of course squatters. For reference, it looks like the company behind the doors and window coverings in these pictures is (no, I am not paid to mention them).


These types of things are interesting to me, not only because of the unique and clever property access, but the bigger question of why doors like this are placed in certain areas as opposed to others. How does a neighborhood over time become “worthy” of steel doors and window coverings? Why would we not imagine seeing these doors in a community like Granite Bay, but then we’d expect to see them in other neighborhoods? There just might be some social commentary and discussion to be had here. Photos from the Field: Heavy Duty Security Doors & Window Coverings for Vacant Properties


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fannie-mae-hvcc-faqSince the Home Valuation Code of Conduct (HVCC) went into effect on May 1, 2009, there has been quite a bit of confusion over who can now talk with appraisers. I won’t re-hash the entire gist here since I have posted previously about the subject, but I did want to post a link to Fannie Mae’s HVCC FAQ in case you have not seen it. This document may be helpful to home owners, loan officers, and real estate agents who are wondering about what type of communication is appropriate under HVCC (as well as other questions then answer).

Download Fannie Mae HVCC FAQ (PDF)

NOTE:  HVCC only impacts loans that are geared toward Fannie Mae or Freddie Mac. Appraisals for litigation, estate settlement, divorce, bankruptcy, and FHA, among other purposes, are NOT impacted at all by HVCC. In effect this means an appraiser like myself can regularly and ethically communicate with many clients during the normative course of the business day because HVCC only applies to certain facets of loan work. Have you read Fannie Mae’s FAQ on the Home Valuation Code of Conduct (HVCC)?


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I always enjoy appraising properties in Placerville, but this weekend was different because I took my wife to a local Bed & Breakfast called the Glen Morey Country House. We enjoyed a much needed time of relaxation where we intentionally did nothing more than have conversation, walk through Downtown Placerville, drink coffee, and read. Well, there was that one MLB playoff game we watched on TV on Friday night too. It’s so important to find time to get away from the hustle of business and raising kids.

If you have not been to Downtown Placerville, I’d encourage you to check it out. It’s an easy detour on the way to Apple Hill or South Lake Tahoe.

The photo below is of a coffee house we discovered called “Centro.” Not only was the java great, but I am such a big fan of architecture, and this building definitely was impressive in design.

Placerville Centro Lundquist Appraisal Company

Here are two photos of the Glen Morey Country House. This house was built 150 years ago in 1859. I was delighted with the era features of the home as well as the privacy and setting of the property. And of course, I really enjoyed the porch. Anyone who knows me well understands my high esteem for the role of the porch in a community. I wrote previously about the prominence of the porch HERE.



No, I am not being paid to advertise any of the businesses above. I’m simply sharing some “Photos from the Field“. Usually this category includes images I snapped between appraisal inspections, but the ones here were simply about leisure. Photos from the Field: Placerville


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022008ins 009aWhat’s been happening with Sacramento County unemployment rates over the past several months? Below are the most recent figures for unemployment during the most recent four months per the Employment Development Department. The rates encompass both cities and Census Designated Places (CDP) in Sacramento County from May through August 2009. Data for September 2009 has not yet been released (wait about two more weeks for that). 

As of August 2009, Sacramento County as a whole has an unemployment rate of 12.3% ( July was 12.0%, June was 11.6% and May was 11.1%). What do you notice about the data below? Does anything stand out to you or surprise you?

Arden Arcade CDP  11.9%  (July 11.7%, June 11.4%, May 10.8%)

Carmichael CDP  9.1%  ( July 8.9%, June 8.7%, May was 8.2%)

Citrus Heights city  8.6%  (July 8.5%  June 8.3%, May 7.8%)

Elk Grove CDP  10.0%  (July 9.8%, June 9.6%, May 9.0%)

Fair Oaks CDP  6.8%  (July 6.7% , June 6.6%, May 6.2%)

Florin CDP  18.2%  (July 17.9  June 17.6%, May 16.7%)

Folsom city  5.6%  (July 5.5%, June 5.4%, May 5.1%)

Foothill Farms CDP  15.6%  (July 15.3%, June 15.0%, May 14.2%)

Galt city  18.4%  (July 18.1% , June 17.8%, May 16.9%)

Gold River CDP  2.1%  (July 2.0%, June 2.0%, May 1.9%)

Isleton city  13.2%  (July 12.9%, June 12.5%, May 11.8%)

La Riviera CDP  6.7%  (July 6.6%, June 6.5%, (May 6.1%)

Laguna CDP  6.4%  (July 6.2%, June 6.1%, May 5.8%)

Laguna West Lakeside CDP  8.3%  (July 8.1%, June 8.0%, May 7.5%)

North Highlands CDP  18.0%  (July 17.6%, June 17.3%, May 16.4%)

Orangevale CDP  8.8%  (July 8.6%, June 8.5%, May 8.0%)

Parkway South Sacramento CDP  20.4%  (July 20.0%, June 19.7%, May 18.7%)

Rancho Cordova City  14.0%  (July 13.8%, June 13.5%, May 12.8%)

Rancho Murieta CDP  3.8%  (July 3.7%, June 3.7%, May 3.5%)

Rio Linda CDP  17.8%  (July 17.5%, June 17.2%, May 16.3%)

Rosemont CDP  9.7%  (July 9.5%, June 9.3%, May 8.8%)

Sacramento city  14.3%  (July 14.1%, June 13.8%, May 13.1%)

Vineyard CDP  5.7%  (July 5.6%, June 5.5%, May 5.2%)

Walnut Grove CDP  26.5%  (July 26.2%, June 25.6%, May 24.5%)

Wilton CDP  7.5%  (July 7.4% , June 7.2%, May 6.8%)

Every single category above, whether city or CDP, saw an increase in unemployment from July 2009 to August 2009. If there was a prize for lowest unemployment rate in Sacramento County, Gold River would be the winner at 2.1%. On the other end of the spectrum, Walnut Grove has the highest unemployment rate in Sacramento County at 26.5%.

Let me know if you have any questions about the latest figures. You are welcome to call 916-595-3735 or visit our company website at Comparing Four Months of Unemployment Rates in Sacramento County: May-August 2009


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I inspected a property in Oak Park yesterday, and while on the road I snapped a shot of the now vacant “Starbucks building” on Broadway. It’s been just about two weeks since the Oak Park Starbucks shut its doors. I know it can be popular in some circles to hate Starbucks, but this one felt a little different because it was connected to an exciting commercial renovation project for the community. Now it’s just another vacant building, one among many, in the current real estate market.


Businesses starting and failing is a part of the cycle of capitalism, and that’s just life, but let’s hope for great things for the next company that moves in on this corner. If you are familiar with this project, how does the image above strike you? Does it make you sad? Or are you full of optimism for what is next? Feel free to comment above. Photos from the Field: Oak Park Vacant “Starbucks Building”


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I thought it would be interesting to take a look at Rancho Cordova sales over the past several years and simulataneously check out unemployment rates during that same time period. Is there a relationship between unemployment and the value of real estate? Generally speaking, the higher the unemployment rate, there is a good chance of lower home prices because the probability of buyers being able to purchase houses at higher prices decreases.

The trend graph below records all single family detached sales in the city of Rancho Cordova through Sacramento Area Metrolist. The unemployment figures are based on data provided by EDD. What do you see in the graph? Does anything stand out to you or surprise you about the sales (blue dots) or listed unemployment rate?

Rancho Cordova Sales and Unemployment Rates September 2006 to September 2009

Below is a view of the past 12 months of sales. As can be seen, the unemployment rate has risen sharply over the past year. It looks like overall the top of the market has seen a decline in property values. At first glance, when viewing a graph like this, it’s easy to gloss over the details, but when looking closely, it’s clear that there are less sales at higher levels over the past months, aren’t there? More specifically, there are few sales above the $400,000 level over the past 180 days.

Rancho Cordova Sales September 2009 and Unemployment Rate by Lundquist Appraisal Company

I don’t want to be misleading in any way by indicating that unemployment is the sole determining factor for property values. That’s not what I am saying. I think there is a relationship between unemployment and the housing market, but that unemployment is only one of the factors involved. This point is illustrated perfectly by a current phenomenon in many sub-markets in the Sacramento Region. Bidding wars, multiple offers, and higher prices have become more commonplace for certain price levels. Despite unemployment rising, the lower supply of housing inventory over the past months has really helped to fuel this phenomenon because there has been more willing buyers than available houses (and prices are very attractive too because of how far they have come down from several years ago). Other factors to consider that may impact the real estate market are supply and demand, governmental regulations, interest rates, consumer confidence in the economy, etc…

Please let me know if you have any questions. You can call me at 916-595-3735 or contact me at A Look at Home Sales & Unemployment in Rancho Cordova


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