Birmingham Appraisal Blog » Alabama

How Shelby County, AL homeowners can find useful property information online

Tom Horn — Mon, 06 Feb 2012 14:46:32 +0000

I would like to share with homeowners in Shelby County, Alabama how they can find useful property information online. Have you ever wanted to find out exactly how big your lot is? Ever wondered where your house sits on your lot? How about finding out what school system the house you want to buy is in? These are all questions you can find the answers to by going to the Shelby County, Alabama website here- www.shelbyal.com. Take a look at the video below and see what type of information you can get.

Were you able to find any useful information? Do you know of any other websites where homeowners can get helpful information for free?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

Appraising In The Aftermath Of A Tornado-Birmingham, Alabama

Tom Horn — Tue, 31 Jan 2012 03:35:57 +0000

How do you appraise a home that has been destroyed in a tornado? That is the question I got from a friend recently after I told him I had gotten some assignments in the storm devastated areas of Birmingham, Alabama. I thought that since he was curious about this that others may be also. I hope this post can provide some helpful information to those with questions about how an appraiser might value a home after it is destroyed.

This past week the Birmingham, Alabama area experienced its second major tornado in less than 12 months. The first storm occurred last year on April 27, 2011, and on Monday of last week another major tornado hit in the Pinson, Clay, and Trussville areas of metro Birmingham. When disasters like this occur, insurance companies must determine the property losses suffered by their customers. Appraisers are often hired to estimate the market value of the home just prior to the loss. Because the effective date of the appraisal is made before the day the appraiser actually looked at the property this is called a “retrospective appraisal”. The appraisal is based on the condition the home was in before the storm occurred.

The appraisers major task is collecting information about the house from an on site inspection as well as from speaking with the owner to determine the condition of the property. Recent updates or renovations are taken into consideration and sometimes pictures are provided that shows what features the home had as well as showing the quality and materials of construction.

After all of the physical characteristics of the home have been determined the appraiser can then go about finding comparable sales that match the property as close as possible. Sometimes a long period of time may have passed between the loss and the day the appraiser looks at the property, but comparables must have sold before the date of value (or loss). Other than recreating the physical characteristics and condition of the home the assignment is rather straight forward and similar to a normal appraisal. If I can help answer any other questions you may have, please let me know. Have you ever experienced the loss of your home in disaster? Tell me about your experience.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

The Chelsea Park Clock Tower

Tom Horn — Wed, 25 Jan 2012 22:43:37 +0000

I like to see landmarks. They help me locate places that I’m going to and help me know that I’m on the right track in getting to my destination. I was in the Chelsea Park neighborhood recently on an appraisal inspection and thought I would snap a picture of the clock tower that sits at the subdivision entrance.

If you think about it, landmarks like the clock tower can add character to a neighborhood and create a sense of cohesiveness within a subdivision, neighborhood, or community. Nice landmarks can make you proud to live in an area while landmarks that are run down or not well taken care of might produce a negative connotation, which could also effect property values in a harmful way. There really is no “adjustment” that an appraiser would make on their appraisal for such a thing, but I think that having something like this can bolster an areas desirability which could help increase property values. How do you feel about landmarks? Do you have any in your area? Do they create a positive or negative influence? Leave me a comment below and tell me your thoughts.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

Six years of sales activity in the Brook Highland subdivision, Shelby County, Alabama

Tom Horn — Mon, 23 Jan 2012 14:23:02 +0000

I like to share market data I get when I do appraisals in different areas. I’ve included sales from the Brook Highland subdivision in the Inverness area of north Shelby County. The sales are from January 2005 to December 2011. The graph charts the median sales price for each quarter for all seven years. The first graph shows a scatter diagram of all sales in this time period.

Sales prices range from $135,950 to $791,536. As you can see in 2005 and 2006 there was a higher concentration of sales, which I have seen in other areas and is expected as this was before we started seeing the effects of the current housing crisis. In the later years there is definitely more sparse sales. In the next graph I have plotted the median sales prices for each quarter of the year.

The lowest median price is at $221,450 and the highest is at $450,000. You can see that there were some drastic variations around the 4th quarter of 2008 (low), 2nd quarter of 2009 (high), and the 4th quarter of 2010 (low). This could be caused by some foreclosure activity or some sales activity within homes in the lower price brackets. Brook Highland has a variety of homes ranging from small garden homes to larger custom built homes with city and mountain views. At the end of December 2011 there were approximately 17 homes for sales, translating to roughly 5 months worth of inventory. This is the absorption rate and I explained how it is calculated in a previous post. Click here to read about it. Do you see any other trends in these graphs? Let me know in the comments below and if you like this post please share it with your friends.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

Sales activity in Montevallo, Alabama for 2011

Tom Horn — Fri, 13 Jan 2012 13:24:14 +0000

I was in Montevallo, Alabama last week on an appraisal assignment and thought I would share with you the sales data I came up with. Montevallo is in southern Shelby County and is the home of the University Of Montevallo, The American Village, and the new Alabama National Cemetery for Veterans.

The majority of sales activity in 2011 was the sale of existing homes, however there was some new construction. The Birmingham Multiple Listing Service records indicates that only 9 new homes were sold last year. There are currently only 6 new homes for sale. Overall sales activity may seem minimal but it seems to be in line with annual sales over the past 3-4 years.

Take a look at my slideshow of scenes around Montevallo, along with the sales statistics contained it it, and let me know if you have any questions, I would love to help you.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

I Can Help Birmingham, AL Realtors With Their Sales Meetings

Tom Horn — Mon, 09 Jan 2012 15:46:38 +0000

If you are a Realtor in the Birmingham, AL area I would like to help you with your sales meetings by providing appraisal education to your agents. I have spoken in the past at local real estate offices about how to read an appraisal, how we come up with comparables, why we sometimes must use foreclosures as comparables and various other issues. These topics are good for new agents to know as well as those that have been in the business a long time but may still have questions. Contrary to what some believe, agents and appraisers can speak together about certain things.

I can also speak about FHA appraisals and how we look at those properties differently than a conventional purchase. By knowing what appraisers look for the agent can prepare the listing so that follow up trips can be avoided, thereby saving the buyer money and helping the loan close more quickly. HUD has certain guidelines we must follow and I can give you a heads up regarding common problems I have found doing FHA appraisals.

If you think I can help you educate your agents on various aspects of the appraisal process please give me a call, email me or text me. I look forward to connecting with you.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

A Look At The Market For Lake Front Homes In Shelby County, Alabama in 2011

Tom Horn — Fri, 23 Dec 2011 21:05:32 +0000

I recently finished an appraisal assignment on a lake front home in Shelby, Alabama and thought I would share with you my findings. As in other sectors of the Birmingham, AL area real estate market, lake front home have experienced a decrease in sales volume. Check out the numbers below going back to 2005.

As you can see, from the 6 year period being looked at, the sales volume peaked in 2006 and then started declining. Over the past four years it has fluctuated in the 10-15 unit range. This is not unusual considering the fact that overall sales volume has been down, and since many of these homes are vacation get aways, buyers have not been as willing to purchase these homes with the uncertainty of the economy and job situation. Take a look at sales prices on these lake front homes in the chart below.

There does not appear to be a significant declining trend in prices but we do see less sales in the more recent years, which we saw in the previous chart as well. So it looks like while there has been a decline in sales volume there has not been too much of a drop in sales prices. At the current time there are approximately 26 lake front homes for sale in the Birmingham MLS, ranging in price from $148,000 to $649,900. At the current rate of sales this creates an oversupply of inventory, approximately 20 months worth. This oversupply is tied to the number of homes for sale as well as the rate at which these homes have been selling over the past 12 months. What do you think about these statistics?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

Assessing The Health Of The Birmingham, AL Real Estate Market-Foreclosure Trends

Tom Horn — Fri, 16 Dec 2011 14:43:25 +0000

Today I thought I would take a look at one of the key elements in assessing the health of the Birmingham, AL real estate market. There are different key indicators including number of sales, change in mean and average sales price, and number of active listings (inventory) to name a few, but today I decided to look at distressed sales, ie: short sales and foreclosures. In a future post I will look at some of the other statistics.

Distressed sales, which include foreclosures and short sales, have had a tremendous impact on property values not only in the Birmingham, AL market, but the entire nation. As I have noted before, our area has not been as hard hit as others. These types of sales have not only caused the average and median sales price to decrease from a statistical perspective but they have also affected the actual sales price of “normal” sales in the market. Due to the sheer number of these types of sales, and the necessity of using them in market value appraisals, they have had a detrimental affect on the sales price of non distressed properties. Take a look at the statistical data provided by the Birmingham, AL Multiple Listing Service.

Click to Enlarge

Since January of 2009 distressed sales have accounted anywhere from 25% to 45% of total sales. The trend from 2009 to 2011 has generally been similar for each year, and reflect normal month to month fluctuations in overall sales, however in 2010 there was an unusual spike in percentage of foreclosure sales in July at the rate of 38% of total sales. This could have been some kind of carry over from the first-time home buyer tax credit or a release of some shadow inventory. Generally speaking though, the percentage of foreclosure sales declined from January of 2009 when it was 45% and has leveled out (not considering typical fluctuations) at between 30-35%. While this is not as bad as other areas of the country it does take its toll on the local Birmingham market. Until the number of foreclosures decrease significantly they will continue to negatively affect the non-distressed sales because they provide competition to them. This is only the case for the foreclosures that are in similar condition and appeal to non-foreclosure homes. What do you think about the figures from the table?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

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Signs of Real Estate Life In Vestavia Hills, Alabama-Miller Hill Subdivision

Tom Horn — Fri, 04 Nov 2011 15:23:52 +0000

I was doing some appraisal work in Vestavia Hills, Alabama this past week and ran across the Miller Hill Subdivision. This is a newer subdivision with new construction. I’ve reported in the past about the slow market for new construction, so when I see it I like to let people know the good news.

It seems like a lot of the new construction is being built by the larger companies who have been able to weather the bad economic storm. That is the case with the Miller Hill subdivision which is being developed by Signature Homes. A lot of the smaller companies have been forced out of business which is sad. I believe small businesses are the back bone of the country and I hope that as the country starts to recover the smaller companies will return to the market. Here are some pictures of the neighborhood.

[Show as slideshow]

New home construction appraisals are a challenge in today’s market. There are several reasons for this. The first has to do with the limited number of new construction sales and the other has to do with certain mortgage underwriter guidelines. Appraisers are required to use comparables from other developments, and from other builders. This helps to give a more complete picture of whats happening in the market. If you just use sales from the subdivision the home is being built in, and from the same builder, it can give you an inaccurate view of the market. If you’re an appraiser are you having problems with this issue? Are you seeing any new construction in your area?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on facebook.

Birmingham, AL: Greystone Market Update-October 2011

Tom Horn — Wed, 19 Oct 2011 17:39:10 +0000

So I thought I would share with you my latest findings for the Greystone Development in Birmingham, AL. Greystone is located in the Hoover area of Birmingham, in north Shelby county. Over the past 12 months the mean sales price of all homes in this subdivision has varied due to the type of homes that have sold, but the trend line in values has been rather steady. There is a wide range of home prices within Greystone as homes vary from small garden homes on slab foundations to large custom built luxury homes with basements on acreage lots.

This variety of homes results in extreme differences between the low sales price to the high sales price. See the graph below reflecting the mean sales price of homes for each month over the past year.

Over the past 12 months there have been approximately 137 homes sold with an average inventory of 9.81 months, which is considered an oversupply. The average days on market is 136, or roughly 4.5 months. The average sales price to list price ratio is 93.03%, which is low as it typically runs around 96-97%. This could be due to the need to drop the list price because the home has not sold. This reinforces the fact that if a home is priced right it will sell. It is critically important to price the home accurately at the beginning so that it sells within a reasonable time.

This information has been obtained from the Birmingham MLS. Are you familiar with the Greystone market? What do you see happening?

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on facebook.