http://www.batonrougemarketmetrics.com/ – Baton Rouge Real Estate: North Baton Rouge Housing Market 2010 Face Challenges, 70805
I’m appraising a home on Wilmot Street, around 1,200sf, 2 bedroom, 1 bathroom. The Fannie Mae 1004MC or Market Conditions report has the appraiser examine the “Sub-Market” or those comps that are actually comparable to the subject property instead of the entire 70805 market. So, this chart below are solds since 6/2008 and current listings from $35,000 up to $90,000 for 1,000sf to 1,400sf homes.
Right off, the first trend we see is that the sales over the past year have declined from 21 7-12 months ago, 7 4-6 months ago and now only 3 sales in the past 3 months. So, sales have almost come to a halt. Absorption rate has declined from 3.5 to 1. Active Listings have increased from 21 to 37, increase of 76%. So, there is a documented oversupply. In fact, for this appraisal, there are 37 competing listings and only 31 competing sales in the past year, more listings than solds in the past 12 months. Months of Competing Housing Supply has increased from 6 to 37 months, an increase of 517%. The median comparable sales price has declinced from $59,000 to $45,000 to $39,500. The median comparable sales days on the market has increase from 83 to 173, an increase of 108%. WITH ALL OF THIS BAD NEWS AND DOCUMENTED NEGATIVE TRENDS, THE AGENTS HAVE DECIDED TO IGNORE THESE TRENDS AND LIST THE OVERSUPPLY OF LISTINGS IN THE $69,900 RANGE! SO, WHEN THESE OVERPRICED LISTINGS ARE UNDER CONTRACT, WILL THE APPRAISERS BE BLAMED FOR “LOW BALL APPRAISALS” BECAUSE THESE HOMES DON’T APPRAISE? FOOD FOR THOUGHT!
NOTE: Based on information from the Greater Baton Rouge Association of REALTORS®MLS for the period of June 1, 2008 to December 17, 2010. This information was extracted on 12/17/2010.