home values

[Slow Ride]

(Rant On)

WTF
Sweat equity my ass

I have been in the process of refinancing my home. We just got the appraisal back. I am pretty much in shock.

The last time we refied the loan our home was worth $127,000 about 2.5 years ago. Since then I've invested in new kitchen appliances, finished half my basement, put in a couple of new windows, put on a roof, put in a new furnace, added A/C, built a gorgeous 26 x 16 raised paver patio, fully landscaped the yard, finished the inside of the 30 x 26 garage, all told I spent around $25,000 and countless hours, blood, sweat and tears.

It came back at $119,000. Holy Sheep $&!@ - spend $25,000 to lose $8,000 sounds like a great ROI.
The appraiser even told me how nice our home was.

Hell I bought the place for $80,000 and if you count the other improvements, like the garage I've spent close to $50,000 in improvements over the last 8 years of ownership. I have done ALL of the work myself except for pouring the slab for the garage and installing the HVAC.

DIY network needs to change some of their shows names. Instead of Sweat Equity the show should be Stupid Homeowners investing like idiots.

(Rant Off)

[bingham72]

Be patient. This is the WORST housing market in years and with housing prices falling in the last 2 years, it is not surprising. Give it a couple more years and you'll get the returns you desire.

[Damn True]

The house is only worth what you sell it for. If it's not on the market it hasn't lost a cent in value.

[parsonsj]

It does matter if he's trying to refinance. That appraisal is all important.

jp

[Damn True]

True enough.

It'll come back. Always does.

[bigvegan]

I feel for you, but if you're not going anywhere, it will come back eventually, and in the meantime, you've got a rad house to live in and the pride of having done a lot of the work yourself.

(As a Californian, I'm a little envious that you live somewhere where nice homes can be bought for under $125k. Here's a sample of what that'd get you in L.A., in neighborhoods many of us wouldn't drive through in broad daylight with the doors locked.
http://www.redfin.com/CA/Los-Angeles...4/home/7283007
http://www.redfin.com/CA/Los-Angeles...2/home/7301806
http://www.redfin.com/CA/Los-Angeles...4/home/7278803)

[parsonsj]

I'm in a similar situation. When I moved to Florida, my house in Maryland wasn't sold, and I was looking at two large mortgages straight in the eye. So I bought a house here in Florida on a 5 yr interest-only ARM, and figured I'd refinance. I eventually sold the MD house, and have pouring as much money towards the principal on the Florida house as I can. In three years here, I've paid an additional $50K in principal, plus 20% when the MD house sold.

But... I'm still upside down. My house value has declined a minimum of 40%. I can't refinance, especially if I want to avoid paying mortgage insurance. I can probably take my liquid savings, put that into my principal, and get there. But I hate like hell to take that kind of risk.

So, I keep trying to push that principal down, hoping the RE values will come back enough so I can snag a fixed interest mortgage. Maybe next year. Sigh.

jp

[Slow Ride]

I understand home prices are higher in other places. You must also consider that I am fairly highly paid as an engineering supervisor at only $68K/year. Another thing to consider with cost of living, is that alot of goods still do cost the same, like cars for example. If you are making twice a much in Cali a car still only costs 30K

Oh yeah and I'll still have to pay PMI with the new mortgage.

[Tony_SS]

I went through something similar. I listed my house for 169k a long before the SHTF w/the market and took it off the market after 2 months with no offers.

I went back, put 9k into a new kitchen and just sold the house a few months ago for $160k and it appraised for 162k. A few recent comps greatly helped that, otherwise I'd be looking at a LOT less for the sale.

That's too bad though, it sounds like some area comps could be bringing your home value down instead of the house itself.

[bretcopsey]

I'm in a similar situation. When I moved to Florida, my house in Maryland wasn't sold, and I was looking at two large mortgages straight in the eye. So I bought a house here in Florida on a 5 yr interest-only ARM, and figured I'd refinance. I eventually sold the MD house, and have pouring as much money towards the principal on the Florida house as I can. In three years here, I've paid an additional $50K in principal, plus 20% when the MD house sold.

But... I'm still upside down. My house value has declined a minimum of 40%. I can't refinance, especially if I want to avoid paying mortgage insurance. I can probably take my liquid savings, put that into my principal, and get there. But I hate like hell to take that kind of risk.

So, I keep trying to push that principal down, hoping the RE values will come back enough so I can snag a fixed interest mortgage. Maybe next year. Sigh.

jp

All of you should check with your current lender about the HARP refinance program. If the current mortgage was sold to Fannie Mae or Freddie Mac, you may be able to refinance into a lower rate even if you are upside down up to 125%. The basic logic is they would rather help you out, thus put themselves in a more favorable position than leave you stuck and have you make the same decision to walk as so many others are doing. One cool feature is that if the original loan to value ratio was at or below 80% and therefore you weren't paying pmi, the new loan will also not require pmi, even with the new LTV ratio exceeding 80%.

Try this link:

http://www.makinghomeaffordable.gov/index.html

[67 caprice]

I bet the County Tax Appraiser thinks it's worth more.

[Steve Firebird]

I bet the County Tax Appraiser thinks it's worth more.

I just got reassessed and my property value went up all most 17K imagine that. Soon the middle class is going to be the lower middle class.

[parsonsj]

Russ,

Actually my taxes are down slghtly, as the county assessment went down too. I can't complain about that...

jp

[wicked68]

its killing refinancings everywhere - so all the "programs" to lower your payments are gargbage.

I went to refinance and I have excellent credit so they came back with a great rate -but they told me the appraisal came back at the same price I bought the home at 6 years ago and since I had turned it into a rental house they now required 25% down - well that was going to require me to cut a 20 k check to cover the buy up in equity and the closing costs.

So passed on it. The other thing you will find is now they are trying to charge pu front application fees that are non refundable if they make you an offer - so you might spend 700 to get a crappy offer you cant afford to take. dont go with anyone that is doing this as you will most certainly just lose the money. I found out the hard way.

You can ask them to send you a copy of the appraisal for proof and likely they wont - if you put it on your charge card you can file a chargeback and claim it under "you never recieved the good you paid for - ie the appraisal".

[Gearhead Dude]

Were still fighting escalating property tax appraisals here in Southeast Texas. Even with excellent data in hand, I was able to trim my County's appraisal down to 6% from their 13% increase. They throw out foreclosures and corporate listings as they are "not true representations of the market value," thus their view of the value of my house is higher. I have to fight it every year.

[Vegas69]

It's a huge mess. Las Vegas has dropped on average 60%. I'm in the Real Estate business and we are starting to see many new purchases not appraise as well now. The appraisers aren't giving any adjustments for upgrades. It's complete bologna and something needs to be done.
In regards to HARP, my understanding is it's up to 105% loan to value. I just closed a Harp on my own home with Bank of America. I was sick of paying the 15 year note. Even though I still had plenty of equity they don't verify income or assets if it was a Fannie or Freddie loan. Just Fico and proof of employment. I ended up with 5.125 on a 30 year with no points. We plan to move soon, so it made sense if I decide to rent vs sell.

[bretcopsey]

its killing refinancings everywhere - so all the "programs" to lower your payments are gargbage.

I went to refinance and I have excellent credit so they came back with a great rate -but they told me the appraisal came back at the same price I bought the home at 6 years ago and since I had turned it into a rental house they now required 25% down - well that was going to require me to cut a 20 k check to cover the buy up in equity and the closing costs.

So passed on it. The other thing you will find is now they are trying to charge pu front application fees that are non refundable if they make you an offer - so you might spend 700 to get a crappy offer you cant afford to take. dont go with anyone that is doing this as you will most certainly just lose the money. I found out the hard way.

You can ask them to send you a copy of the appraisal for proof and likely they wont - if you put it on your charge card you can file a chargeback and claim it under "you never recieved the good you paid for - ie the appraisal".

Unfortunately, the appraisal is property of the lender and they are not obligated to share it with the borrower.

The HARP program is aimed at helping people keep a roof over their head, thus primary residence only.

In regards to HARP, my understanding is it's up to 105% loan to value.

FNMA just announced 125% as the new maximum limit.

[andrewb70]

Unfortunately, the appraisal is property of the lender and they are not obligated to share it with the borrower.
......

That is not universally true. I am about to close on a condo and they sent me a copy of the full appraisal report. The appraisal came back higher than my purchase price. Then again, the methodology of using comps is not valid in many areas where property turnover is low. That was the case in this neighborhood.

Andrew

[BA.]

Look at you Bret! Damn, you're all over it!

[Vegas69]

The appraisal is always available to the borrower.