August has been a blur for us. Historically low-interest rates + Low Inventory + Pent Up Demand = High Activity in the Housing Market. We have been very busy and we are not alone. The DW Slater Company and appraisers have a high demand for their services at this time. We are thankful to our clients for trusting us to continue to provide quality appraisal services in a timely manner.
The housing market in North Texas has been very active. The number of houses sold is up double digits from last year in all four counties. Prices have increased in July. This is amid the pandemic. Many are wondering how this can be. With so many job losses due to the pandemic, wouldn’t that cause the prices to go down? The pandemic has caused many to rethink their current situation. Many are anticipating and hoping those jobs come back. We are seeing many that are moving out of the cities to the suburban and more rural areas. Some are moving to different homes to better accommodate work from home space.
There are some headwinds that are troubling. As we see many jobs in jeopardy, such as the airline industry, the retail industry, and many more, this will threaten homeowners ability to pay their mortgages. We will continue to watch the numbers, particularly the number of foreclosures going forward.
Let’s take a look at the numbers:
Median Price Trends
$337,380 | +4.6%
$365,000 | +6.2%
$281,250 | +13.4%
$260,000 | +5.7%
1.9 | -45.7%
2.0 | -48.7%
2.5 | -32.4%
1.7 | -34.6%
Price per Square Foot
$146 | +3.5%
$143 | +2.1%
$150 | +7.9%
$132 | +3.9%
2,040 | +21.5%
2,172 | +23.1%
2,882 | +18.1%
3,267 | +14.8%
Days on the Market
19 | -24.0%
22 | -31.3%
18 | 0.0%
13 | -7.1%
As you can see, there has been a lot of activity in our markets. The inventories continue to decline, sale volume has increased and marketing times decrease.
At this time were are not seeing an increase in distressed sales. We will continue to watch this trend.
Riding in September
We will be riding in the Great Cycle Challenge this September. Our goal is to ride 200 miles. This ride was originally scheduled for June but was postponed. We are riding in memory of our friend, Greg Harden, that we lost this year to cancer. Please consider sponsoring our ride and helping us to fight cancer. You can also follow along with us on our page. Click here for more information.
We hope that you are doing well. If you have any questions or appraisal needs please feel free to reach out to us at https://www.dwslaterco.com/.
We are now into the very hot months of summer in North Texas with average temperatures of 96 degrees (not factoring in heat indexes in the triple digits). The housing market has been on a pandemic pause but last month has moved upward. As this pandemic is lasting longer than many had hoped or expected, there is now a pent up demand for housing in North Texas.
After spending more time at home, the need for a home office and a desire to be in a less dense area, are making a move to different housing more appealing for many. As a result, the number of sales for the month of June has surged. Supply is down and volume is up. New home starts are up 17.9% from last year as supply is trying to keep up with demand. The more rural markets are also seeing lots of activity. We will share some of the data from the rural counties this month so make sure to scroll down for the interactive charts!
The Texas economy is still struggling but recovering some during the pandemic. According to the latest report from Texas A&M Real Estate Center:
These low rates have certainly encouraged many to buy or refinance a home. However, the longer the pandemic and uncertainty exist, the more job losses will impact the purchasing power of many. Recent job losses reported in our area- JC Penney with 1,000 jobs cut and American Airlines is laying off and furloughing 25,000 jobs. Both of these companies are headquartered in North Texas and the impacts of these job losses have yet to be seen.
Let’s look at the numbers for our main four counties:
Median Sales Price
Denton County $325,000 | +1.2%
$360,000 | +1.6%
$270,000 | +1.5%
$255,000 | +2.0%
Median Price Per Square Foot
Denton County $144 | +2.9%
$144 | +4.3%
$147 | +2.8%
$131 | +4.0%
Days on Market
Denton County 20 | -20.0%
25 | -10.7%
20 | +25.0%
14 | +7.7%
Months of Supply
Denton County 2.0 | -42.9%
2.2 | -45.0%
2.5 | -30.6%
1.7 | -34.6%
Denton County 1,772 | +17.9%
1,864 | +8.8%
2,436 | +7.9%
2,847 | +6.0%
Now, let’s take a look at some of our less dense and rural market areas. We have included Cooke, Grayson, Wise, and Parker Counties. These, of course, are not all of the more rural counties around the DFW market but they are some of the counties we most often serve.
Median Sales Price
Cooke County $248,200 | +10.9%
$195,298 | -5.4%
$273,900 | +9.6%
$341,000 | +11.8%
Months of Supply
Cooke County 3.4 | -42.4%
3.2 | -30.4%
3.1 | -26.2%
3.0 | -25.0%
Cooke County 42 | +7.7%
244 | +34.1%
113 | +18.9%
313 | +19.5%
These markets are seeing double-digit growth in the number of sales, as well as a large dip in the supply and an increase in the median sales price. This uptick in activity in the more rural markets has been attributed to the uncertainty in the more densely populated areas. Some are really just wanting to get away from it all and are looking to the rural areas for the respite.
Life Goes On
Although we are in the midst of a pandemic, which has cause much disruption in the world, we are reminded that life still goes on. People are still buying houses, getting married and having babies. We are proud to announce the birth of our fourth grandson! He was born this month and is doing well.
“In three words I can sum up everything I learned about life:Life Goes On”
As always, if you have any questions about real estate appraising or need services, please do not hesitate to contact us. Stay safe and well!
Interesting Real Estate Related Reads & Recommendations
Today is the official first day of summer. Can you believe it? Spring just really meshed into summer since all of the stay home orders. Nothing this year is normal as we are still in the midst of this pandemic. We hope that you are able to find a safe place to stay cool and enjoy your summer time.
We recently took our kids to visit Turner Falls in Oklahoma which is the cover picture. It is a waterfall from a natural spring in the Arbuckle Mountains. We love the area and were able to spread out , social distance, hike, swim and enjoy the beautiful geologic formations.
The housing markets have so far not seen big declines in prices during the pandemic but the supply and volume show drastic decline during the pandemic. Both the supply and inventory have double-digit declines YoY but prices have remained relatively flat. So why haven’t prices declined? As we discussed last month, the supply and demand both decreased in tandem. Typically if the demand decreased but supply remained the same, a lowering in price would occur. During this pandemic, the supply has also decreased, keeping the supply/demand ratio similar to prior to the pandemic.
As we move forward, we will continue to watch the housing market and economy for North Texas. As we are still in the middle of this pandemic, we do wish you all safety and health. As always, please let us know if you have questions or comments about real estate appraising or need appraisal services.
Happy Father’s Day to all of the dads and those who are like fathers to us. You will never know how important you are. We celebrate you!
As Dickens penned, “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.” The last two months have been times like none of us have ever seen. I was able to visit with my grandmother who is 91 and in a nursing home. While Facetiming, I asked her if she ever experienced anything like this pandemic. She said, “No, not anything can compare”. She was a nurse during WWII and lived through the depression. She has been around but she said nothing can compare. I think that is certainly true.
Times have been hard and these hard times are not over, but there have been some good things to happen as some families have been able to spend more time together and prioritize what is most important. I have seen courageous frontline workers and many appreciating all of those jobs that are essential for supply chains. As I type this newsletter, we just launched astronauts in space with a reusable rocket.
Our apologies for the delay in getting this newsletter out as we are now at the end of the month, but we have been busy and most importantly we had our son’s wedding this month (pic at the end of the newsletter). There were many adjustments and last-minute decisions that had to be made. The wedding went from a large to a very small gathering and then from an outdoor wedding to indoor due to the weather. They have been together 8 years so we agreed with not delaying it! We will have a large celebration later but in the meantime, we are very happy they started their married life together and wish them the best of times!
In regards to the housing market, some have tried to compare it to 2008 or 1980s S& L crisis but a forced shut down during a pandemic of epic proportions is not like any of those things. Many are thinking that the market should be tanking but what many do not understand is when we are looking at a market, we are looking backward. There is usually around 30 days, sometimes more from the time buyers and sellers have a contract and then the sale is actually closed. The numbers shown on the charts below are up to April, so many of these sales began in March. Next month’s numbers will be more telling of what occurred during the shutdown. We can get a glimpse of the future by looking at the pendings and number of listings of which were down.
In many ways, the market appears to have hit a pause button. It seems that the supply and demand both retracted in tandem, meaning that overall prices, as of yet haven’t seen significant declines. As we shared in our January & February newsletters, the market was really heating up before the pandemic. We see prices either slightly up or flat for the month of April. The supply has decreased as many were taken off the market during the shutdown. Sale volume is also down, which is not surprising during the shutdown.
Let’s take a look at the numbers:
Median Sales Price
$314,000 | -0.3%
$347,500 | +2.8%
$260,000 | +4.4%
$255,992 | +6.7%
Average Price Per Sq. Ft.
$145 | +2.1%
Collin County $145 | +2.1%
Dallas County $164 | +0.6%
Tarrant County $134 | +3.9%
Months Supply of Inventory
Denton County 2.4 | -25.0%
Collin County 2.6 | -27.8%
Dallas County 2.7 | -18.2%
Tarrant County 2.0 | -13.0%
Denton County 1,190 | -14.9%
Collin County 1,217 | -19.9%
Dallas County 1,679 | -28.7%
Tarrant County 1,890 | -25.1%
Days on Market
Denton County 18 | -21.7%
Collin County 22 | -12.0%
Dallas County 20 | 0.0%
Tarrant County 16 | +6.7%
APRIL 2020 Denton County 1,608 | -25.8% Collin County 1,576 | -34.8% Dallas County 2,391 | -32.7% Tarrant County 2,623 | -23.9%
Looking ahead , since Texas is now in various stages of reopening, we will see if these trends begin to change. Mortgage interest rates are at all time lows but lending has tightened. If some jobs don’t come back, the economy will be impact and the available pool of buyers will decline and impact the market.
Celebrations & Anniversaries!
This is our 5th year of doing our monthly newsletter. The very first newsletter was sent out 5 years ago this month. We have changed the format a bit but we hope you enjoy it. Please give us feedback, questions or topics you would like us to cover.
We also want to celebrate Shannon Slater for 14 years of working at the DW Slater Company. Shannon joined the company in May 14 years ago making this a husband and wife appraiser team. Shannon thought, if it didn’t work out, she would go back to being a school teacher. After 14 years, we can safely say that it has worked out. Happy Work Anniversary!
Now for that wedding picture we promised! We are so very happy for our son and his new bride. We wish them the best in their future together!
As we look forward to the summer months, we will continue to provide you with monthly updates and information on the housing market. We also love being your appraisal service provider. If you have any questions about real estate appraisals, please don’t hesitate to contact us. We will get through these times. The beach picture we took a year ago in Hawaii. It was a peaceful place and a peaceful time. We will find our way back. This too shall pass. Until then, enjoy a little bit of Styx, The Best of Times.
We are curious about how others feel about real estate during this pandemic. Does our current situation impact whether you would choose to buy or sell real estate? Please take this poll and let us know your thoughts. Thank you!
We pray you are all safe and well during this unprecedented time of dealing with the COVID-19 virus pandemic. Here in Texas, a disaster proclamation was ordered on March 13th. Then on March 19th Governor Greg Abbott issued more executive orders to mitigate the spread of the virus. This order closed restaurants, bars, gyms, massage parlors, schools, and prohibiting visits to nursing home facilities. On March 31st, an executive order implementing essential services and protocols. Several more orders have been issued since and you can review them here. So through mid-March through April, we saw more and more activities ceasing in order to slow the spread of the virus, now as we are coming to the end of April, we are seeing the beginning of the reopening of activities.
How Has This Impacted Real Estate Appraisals?
For appraisers, we are still working and providing appraisal services as identified under essential services. (note this will vary from some states or counties with greater restrictions). There have been many changes to how we can appraise, with an emphasis on allowing appraisals to be performed “from a distance”. Fannie Mae and Freddie Mac, FHA, VA, and USDA have all made changes and allowances for desktop or exterior only appraisals where the appraiser does not enter your home. There are ways for the homeowner to send pictures and information about the home so that the appraiser doesn’t have to enter the home. We must point out that not all loans will qualify for this type of appraisal and full interior inspections of homes we still be required. We recommend discussing with your lender the possibility of using one of these appraisal alternatives if you have concerns about the appraiser coming into your home.
If you do end up having a full inspection there are things that you and the appraiser can do to safely perform an interior inspection. We recommend:
Try to be vacant from the home at the time of the inspection or go outside when the appraiser is inside.
Have all doors open and lights on. This is so the appraiser doesn’t have to touch anything within the home.
Please inform the appraiser if anyone in the home has been ill.
The appraiser can wear disposable gloves and a mask to help minimize any potential spread of viruses. We also sanitize before and after an inspection.
Appraisers and lenders are doing their best to navigate these temporary changes during this pandemic. There is a lot of information regarding the changes and requirements. Here are a few resources that we recommend that have all of the information at one site:
How Has Coronavirus Impacted Our Real Estate Markets?
As it relates to the real estate market in our area, it is still too early to determine the impacts of the pandemic on our markets. Looking at the stats for March, the impact has been minimal but what you have to understand, that the sales that closed in March began in February. The sales that close in April were typically under contract in March. Real estate moves a bit slower so it’s more difficult to see the immediate effects. Real estate agents have moved to online virtual showings, buyers become hesitant during times of economic uncertainty, and lending has become tighter during this time.
We can look at listings and pendings to get a bit of a glance into the future. We will share the current market updates for our main four counties as well as a few additional charts as well to see what is going on in the market. We are seeing a slowing in the number of sales in April which is expected. Let’s dive in:
Median Sales Price
$319,000 | +0.9%
Collin County $345,000 | +2.8%
$263,000 | +7.3%
$246,502 | +3.6%
Sale prices for March are still moving up, which shows how strong this market was as the pandemic hit. All four counties increased YoY.
1,324 | -13.2%
1,337 | -18.5%
Dallas County 1,899 | -23.7%
Tarrant County 2,153 | -20.0%
Pending sales are down YoY in all four counties, which speaks to the future lowering of sale volume in April. This certainly makes sense due to the shutting down of businesses and stay at home orders that came into place.
Denton County 2.3 | -20.7%
Collin County 2.5 | -26.5%
Dallas County 2.6 | -16.1%
Tarrant County 1.9 | -13.6%
The supply of homes has also decreased in all four counties as buyers have either canceled their listings, temporarily taken them off the market, or decided to wait until the curve has flattened on fighting the coronavirus.
Denton County 1,349 | +3.0%
Collin County 1,393 | +3.9%
Dallas County 2,106 | -0.3%
Tarrant County 2,245 | -7.0%
When it comes to sale volume, Dallas & Tarrant County were both down for March whereas Denton and Collin county have modest increased YoY.
Days on Market
Denton County 26 | -13.3%
Collin County 27 | -27.0%
Dallas County 20 | -9.1%
Tarrant County 18 | -5.3%
The number of days on the market is down in all four counties, which again shows some of the strength of the market heading into April before everything was shut down. Marketing times are still very low and under one month.
Looking a little into the future. Here I have compared sale volume for each county for the month of March and what has currently reported as sold in April as of 04/23/2020 for three years. Based on the current raw data that we have so far in April.
Denton County sale volume is down 21.2%
Collin County volume is down 21.7% YoY
Dallas County volume is down 33% YoY
Tarrant County volume is down 29.5% YoY
So , more impacts from the coronavirus will be seen next month and the months to follow. It will be interesting to see the long term impacts of the pandemic as we move forward through the summer months. Please reach out to us with any questions you have. We are here for your appraisal needs.
Normally, I would have a lovely picture of spring full of discussions of the spring market activity but, as we all know, there is nothing normal going on in our lives right now. We now use the new term “social distancing”, kids are distant learners from home, churches are learning to stream their services online, families are using Zoom or Google Hangouts to connect and many have been laid off as their employers have been forced to close.
When Italy began to have major struggles all of the world leaders began to realize the seriousness of this particular virus. The COVID-19 virus as it is now identified as. The long incubation time of this virus has made it much harder to manage because many are spreading it unknowingly. We are all now trying to do our part to “flatten the curve” to lessen the strain on our medical resources as we limit our distance from others.
This world pandemic has been unprecedented. Many who study real estate markets have been trying to compare the impacts of this pandemic to previous events but there is nothing to compare to this sudden cessation of the economy.
Our real estate markets had taken off in January and they were continuing that pace through February. The charts provided in this market update are from February as we don’t have all of the numbers in for March. Everything was going great until everything came to an abrupt halt with the sudden need to try to stop the spread of COVID-19.
Have you ever been to a track meet and a running event had a false start? If you recall our newsletter last month, it showed runners bounding out of the starting blocks. With a false start, runners burst out of the blocks at the sound of the starting gun only to come to a quick stop once the gun sounds again signaling a false start. Someone started too early so the race has to restart. This is how I visualize the housing markets in North Texas. The markets were off to a great running start, only to be halted with all momentum ended.
So as we take a look at this market update, we know that all of this was before any impact of the global pandemic was evident.
We will be watching the direct impacts of the Covid19 crisis on our markets so look for that in next month’s newsletter. Let’s now look back to “Pre-Covid19” markets in February for Denton, Collin, Dallas and Tarrant counties. Out of the starting blocks and going strong, we saw prices up, supplies down and volume up.
Median Sales Price Trends
The median sale price trends in all 4 counties are up YoY. See the percentages below. The stats from last month – Denton is down 0.95%; Collin is up 1.66%; Dallas is up 2.5% and Tarrant is up 0.83% from January.
$310,000 | +1.9%
$337,820 | +4.0%
$246,000 | +4.7%
$242,000 | +5.2%
The number of sales is up in all four counties with the exception of Tarrrant County which is down a slight 2.2%
1,084 | +16.7%
1,150 | +11.3%
1,756 | +7.9%
1,833 | -2.2%
Months Supply of Inventory
All four counties have a decrease in supply as the demand for housing at the first of the year has been strong. All three counties have less than 3 months of supply.
2.2 | -24.1%
2.4 | -25.0%
2.5 | -16.7%
1.8 | -14.3%
Days on the Market
The number of days on the market decreased in both the northern suburb counties of Denton and Collin. The number of days on the market increased for the more urban counties of Dallas and Tarrant YoY, however the number of days on the market is less than Denton and Collin counties.
42 | -4.5%
46 | -14.8%
32 | +33.3%
26 | +8.3%
Appraising During the COVID-19 Outbreak
Fannie Mae, Freddie Mac, and the FDIC have provided guidelines and some temporary exceptions to appraisal requirements. In some instances, an exterior inspection can be made rather than a full inspection and in some cases, a desktop appraisal may be suitable. This is a decision that can be made by the lending institution and perhaps with a discussion with the appraiser. Here are links to the recently published guidelines:
In most states and counties real estate appraisals for financial institutions fall into the category of “Essential Businesses”. There is some discrepancy in Dallas County vs the city of Dallas as to whether appraisers are considered an Essential Business. We are searching for further clarification on this but in the meantime, we continue to provide services to our clients in a safe manner while following regulations in the counties and cities we service.
Please know that we have been taking precautions during this time to keep ourselves and others safe. If someone in your house is sick please inform the appraiser prior to the inspection. Please turn on all lights, open all doors and gates. Secure your pets. This eliminates the need for us to touch anything. Here is a link to a helpful article on helping an appraiser during an inspection as it relates to COVID-19.
We can all work together during this time to stay safe. We will continue to stay abreast of appraisal guidelines and local, county and state guidelines. As we watch the markets, we will be paying particular interest to listings and pendings as they can give us a little bit of a peek into the future.
As my grandmother often tells me, “this too shall pass”. I believe her. She lived through World War II and the Great Depression. She has been a steady rock in the lives of our family. Now she is in a nursing facility in quarantine, as she is at risk at the age of 91. I miss being able to see her. We pray that this will pass sooner than later and that we all come out stronger on the other side of this. We pray for health and safety for each of you as well. With that, I will leave you with a spring picture- change is coming and we will weather this storm.
“And now we welcome the new year. Full of things that have never been.”
Rainer Maria Rilke
We hope that your 2020 is off to a great start! As we enter another year, we wanted to look back at 2019 and review the year. We went a little more in-depth with some of the statistical data and have some different graphs for you. This year we continued to see population growth as inventories are beginning to increase. Some interesting stats of note:
Tarrant County had the largest number of sales in 2019
All four counties show slight price increases in 2019
All four counties have increased supply
All four counties have bank-owned (foreclosure) of less than 1%.
Here are the numbers and stats for 2019:
Overall the markets are flattening with slight increases for the year. We are not in a down cycle. As the Texas economy remains strong and population growth continues we do not anticipate a market decline. That said, unforeseen things can impact the market, thus we will continue to provide you with monthly updates and information.
**Please note that these statistics are general market trends and are not considered to be used to determine the value of your specific home**
Please let us know if there is are other metrics or information you would like us to cover for North Texas.
Building home equity is one of the many financial benefits to homeownership, but sometimes it’s hard to know where to start. Increasing your property value through renovations or home additions, and paying off your mortgage, seem like the most straightforward ways to build equity. But there are also some factors that determine what your house is worth that are out of your control, like the location and popularity of the particular housing market. We gathered tips from experts in the field to share what they find to be the most effective ways to build equity in your home.
Spurgeon Appraisals: Thinking about putting in a gazebo? A saltwater pool? Custom features may not always contribute to value, because they may not be widely accepted by your market. Spend your money where every homebuyer looks, the kitchen, bathroom, roof, and repairs. The more you stray from the norm the less likely you’ll see a return on your investment.
OlaesSmith Appraisals: A good way to build equity in your home is to see if your house is being used at its highest and best use. Being able to add additional square footage to your home to maximize your floor to area ratio allows you to use larger home sales when an appraisal is done on your home, which in turn will add more equity to your home versus its original smaller footprint.
John Tsiaousis, Chicagoland Appraisals: Start by understanding what is happening in your market for the type of property you have. Let’s take a 2-flat in Chicago’s Logan Square for example from a real estate appraiser’s perspective. If you were to automatically remodel the kitchens and bathrooms in both units in a very short time you’d find yourself having questions as to the value. Most 2-flats in Chicago’s Logan Square are not being fully remodeled, rather the 1st-floor unit is being duplexed with the basement and that is being fully remodeled to current tastes and the 2nd-floor unit is being spruced up with paint and minor updates.
Alex Argianas, Argianas and Associates: Your first priority, if you have been putting off, should be superstructure & mechanicals like the roof, HVAC system, electrical and plumbing. What’s more, a proper appraisal will identify and should apply the costs associated with these upgrades in the appraisal of the home. A new kitchen is great, but if the roof leaks or you can’t heat it, you’re going to have some unhappy home buyers.
American Realty Appraisals: While it’s important to increase the energy efficiency of the home which will improve comfort and lower utility bills, the market doesn’t react to these critical factors that they don’t see, like they should. One thing homeowners can do which may not necessarily increase the equity in the home on a refinance, but lowering your taxes through tax appeal can increase the purchasing power of a potential buyer and thus increase buyers’ bids to purchase the property…..and that is extra equity for the homeowner.
Gynell Vestal, Consumer Home Value: Build a strong relationship with a local real estate appraiser. They should obtain an appraisal every few years to keep current with their home value and property expectations for their market. An appraiser can advise them on trends and characteristics important in their micro-market and the cost-to-value relationship of improvements remodels or upgrades being considered. This way homeowners spend their money on improvements that will maximize returns and are steered away from potential over-improvements.
Matthew Frentheway, Aspen Appraisal Group: Typically, the amount people spend in finishing a basement will only yield about half as much in equity. So it’s not a good idea to finish one if you expect to get immediate equity back out if they sell or get a loan. It is better to do it for the use of the area, and wait for the market to increase to get your money back out.
Sun Point Appraisals Inc.: The one thing on a financial lending appraisal report and only one thing regarding upgrades is a box on page 1 of the report. This box asks the appraiser to indicate if the kitchen and/or bathrooms have been updated within the prior 15 years. Once this box is checked “yes” the Appraiser now has told the Reader of the report this home is updated. Now when the Appraiser compares this home (the subject of the appraisal) to other recently sold homes they will need to analyze how this updated kitchen and/or bathrooms have impacted the overall value of the home.
Appraisal Partners: One way to help gain equity is to help sell your neighbor’s home. As an agent, I have run into scenarios where neighbors are not very accommodating when it comes to the sale of their neighbor’s home. They take down directional arrows, they steal yard signs and leave cars parked in the street. If you’re directly next to the home for sale, clean up your backyard. I have had a few sales where the property had trouble selling because the neighboring backyard was in disarray. As an appraiser, we are looking for comparable sales to form our value opinions. If your neighbor’s home sold low, likey when you go to refinance, we are going to use that sale as a comparable for determining value. So if you see your neighbor trying to sell their home, help them out. Spread the word, be accommodating and help the real estate agent.
DW Slater Company: Home improvements can add equity to your home, however, we recommend checking with a local market expert to find out which improvements are showing the best return on investment in your area. Not all markets are the same. Kitchen remodels may add greater value in some markets where outdoor living spaces will add more value in another market. Check with a local real estate appraiser.
Jamie Owen, Aspen Appraisal Services: If you have a walk-up attic with a high enough ceiling height, a fairly simple way to add equity is by finishing and heating that area. It’s a fairly simple way of adding gross living area and it’s much less expensive than most traditional additions. If a person wants to do so, I recommend checking with their municipality to make sure that it is legal to do so and that the area can be considered gross living area when completed. But this is a relatively easy way to add equity.
Brian Kirkpatrick, DFW Appraisals: Equity is in residential real estate is typically built by identifying items that the current market reflects. In the day and age of real estate television shows, Pinterest, and social media, one can visibly see what trends are current with fashion and styling. Updating components of your home to reflect popular culture is the best way to build equity in your property. Components such as roof, HVAC system, and water heater are considered short-lived items; meaning, their economic life span is shorter than that of the real estate. Always remember that cost is what you pay but value is what you get.
Just Appraisals: Design trends come and go, but a great way to add long-lasting value is by adding an accessory dwelling unit. The extra living space and potential income will continue to add value for as long as you own the property.
Ryan Lundquist, Sacramento Appraisal Blog: This might sound strange, but one of the best ways to build equity is to do absolutely nothing. During an increasing market, a homeowner has an incredible opportunity to sit back and build wealth by simply riding the wave of growth. In fact, many owners have done this over the past eight years and they have hundreds of thousands of dollars in equity without having lifted a finger. Yes, kitchen remodels and other improvements can surely make a big difference for a home’s value, but what the market is doing can actually mean way more.
Master Appraisal Services: If you want to build equity in your home to increase the value, the pat answer is almost always updating kitchens and bathrooms or add square footage. Just updating is not necessarily maximizing the potential. It is also important to make sure that the updates are current to today’s demands and expectations of the market. One way to see what is most current is to go tour the model homes in new developments for ideas.