“Desktop Valuations” are a quick way to look at the potential value of a home, but they do not take many factors into consideration, and some of the things they DO use to determine a value should not be used!

I answer questions on the Zillow site, and so many times the questions come from a place of, “Why, in my townhouse community where the houses are very much the same, is my neighbor’s worth $XXX and mine is worth $45,000 less despite mine being an end unit with an additional bump-out?”

That is a very good question, and one that doesn’t have a good answer. The algorithm takes into account the taxes you pay and when the house last changed hands. If a house hasn’t changed hands in some time, the taxes generally are lower, and that would bring the “value” of that house down. That just doesn’t seem right, does it?

Next to this is an example of the “range” of value for one house I found. If a professional real estate agent walked into your house and told you they thought it might sell for somewhere between $391,000 and $740,000, would you feel comfortable that the agent knew your market?

How about the houses “for sale nearby.” Do these look like they belong together as a picture of a particular Towson community to you? They seem to be a random selection of homes that happen to be in the same zip code.

The biggest issue is the quality of the Baltimore Zestimates.

As you can see here, Baltimore Zestimates are within 5% of an actual sales price only 42.6% of the time. They are within 10% of an actual sales price 66.4% of the time. They are within 20% of a sales price 83% of the time. These are with a median error of 6.1%.

Think about what that means.

On a $400,000 sales price, the Zestimate may show $380,000 or $420,000 — but again, that is only 42.6% of the time.

To get above 50%, you have to go within 10% of the actual sales price. So on that same $400,000 house, a Zestimate 66.4% of the time will be from $360,000-440,000.

To get to the closer 83%, you have to bring that out to 20% of a sales price. That could drop the Zestimate down to $320,000. Would you as a Baltimore seller be happy with that if your house were truly worth $400,000? How about a homebuyer? Would a Baltimore homebuyer be happy to pay $480,000 for a house that is really worth $400,000? Probably not. And the buyer’s mortgage company most likely wouldn’t let it happen, because an actual appraisal would most likely be close to the true market value of $400,000.

And don’t forget — that is with a median error of 6.1%, or approximately $24,000 give-or-take, on that $400,000 house.

Real estate everywhere is LOCAL. Hyper-local even.

Baltimore real estate values can be different street-by-street!

For a true understanding of your house’s value, don’t count on automated valuation websites. Contact me for a true idea of you Baltimore house value. I’d love to help!

Would you like to know more and see additional Zillow issues in the Baltimore area? See my past posts on incorrect Towson Zillow Zestimates for details.

A home inspection, usually, is a VISUAL inspection of a property, running water & systems when they can be run.

What does that mean?

It means that the inspector can’t break through walls, can’t take things off or apart, or ruin the house in any way. He or she will often take the cover off of the electrical panel to inspect that the wiring is correct in there. He or she will generally go around the outside of a house to evaluate if water is running away or toward the house. If the washer and dryer are staying, and the water is on, the inspector generally runs them to see if it runs.

In general, things the inspector can SEE are checked. Dishwashers, stoves, exterior foundation, pipes that can be seen, walls that can be seen, and electrical outlets are often tested.

What can’t an inspector do? See in the walls or under ground, or remove a wall or floor to see behind. It makes it hard to see if there are problems behind them. Are there leaks in the pipes in the walls or under ground? If he or she can’t see them, it is hard for them to discover.

Roofs are an issue that come up often — what is the age? What is the life expectancy? Unless the actual age is known, the inspector most likely cannot determine exactly how long the roof will last. He or she can make estimate ranges based on what he or she sees.

A home inspector does not always walk on the roof. There are many slate roofs in Baltimore, and, in general, slate roofs are not walked on for fear of breaking the tiles. An inspector can look at it with high powered binoculars, but many inspectors also do not specialize in slate roofs.

If the pitch of the roof is too high for the ladders the inspector has, he or she also won’t be able to walk on the roof. Again, high-powered binoculars can be used to assess the condition of the roof.

The chimney is an item that may or may not be covered in a home inspection. It may depend on the type of chimney and how much of the chimney the inspector can see. The inspector can note if he or she sees loose bricks, mortar, or a lack of cover.

Some inspectors have additional tools and specialities, or you may be able to hire additional specialists for a more comprehensive look at some components of a house.

Again, to recap, a home inspection usually is a visual inspection of a house. Home inspectors in Maryland should be licensed, and your copy of the inspection or contract may have that information.

For more details about buying a house in Baltimore, I’m here to help!

Photo courtesy of justinbaeder via Flicker CC

According to a Washington Post rundown of the changes, a major one is the “spot approval” that used to be acceptable to be eligible for an FHA loan. Another article goes more in depth on the issues this is causing for condo home sellers.

The agency eliminated spot approval earlier this year. Now, any condo buyer with an FHA loan must stick to an FHA-approved building. A lender, developer/builder, homeowners association or management company can submit a package to the FHA seeking approval. The change was part of a broader initiative to tighten FHA condo policy. Some elements of that initiative have been temporarily loosened through Dec. 31 to try to stabilize the condo market.Why? Condos are widely considered the market’s shakiest segment because they are popular with speculators and financially vulnerable entry-level buyers. A lot of foreclosure-related losses have come from condos, which is why industry policies have forced lenders to look more closely at the makeup of entire complexes before extending loans.

Without that FHA approval, it ties the hands of many buyers, as most would then need more money for a downpayment, which they may not have.

I did a quick spot check on Timonium condos on the HUD site where you can review FHA condo approval statuses. I was sad to see how many had expired, leaving any sellers in those buildings at a disadvantage! Of the 23 Timonium condo communities that came up when I searched 21093, 16 of them have expired. Here is a pdf of the Timonium FHA condo statuses as of today.

I have written much about the FHA Condo Recertifications, because we have so many Timonium condos that are now affected by these changes.

This is not good news, and I hope that the associations are working toward their re-certifications, though I understand across the US that many have tried and been denied over technicalities or other issues, and that the penalty for a director providing incorrect information (even if in error) faces $1 million in fines & up to 30 years in jail, so many are not willing to take on the risk.

Hopefully there will be another resolution on this matter, so affected condo owners aren’t hurt more by the inability to sell to FHA homebuyers.

The amusing part to me, is when I clicked on it, directly under the asking price is the Zillow Zestimate: $396,500. Yes, you read that right, Three hundred ninety-six THOUSAND, five hundred dollars.

Now, I realize Zillow’s algorithms have what they claim to be somewhere between a 7-11% margin of error, but this one is off by 88.27%. OFF BY ALMOST 90% OF VALUE. Hm. Think something might not be right?

Yet Automated Valuation Systems are the way banks are doing quick appraisal reviews, and no wonder they may be coming in low.

I’ve discussed the Zillow Zestimates in the past, beginning with Zillow Zestimates for Towson Real Estate May Be Misleading. I have come across a large number that were not close to a selling price of a home.

Then, I had communications with some Zillow executives, where some light was shed on why it is possible they are off in our area, which I discussed in Misleading Towson Zillow Zestimates Explained Further.

Zestimates started to complicate things further as the market began to drop, because banks began to reduce Home Equity Lines of Credit, and were using Desktop Valuations to do so. When one of my clients called his bank, his loan officer pulled up Zillow & told him that’s why it had been dropped. (See Incorrect Towson Zillow Zestimate Strike Again.)

Earlier this year, Zillow updated their Algorithms to try to correct some of the problems. For the Baltimore metropolitan area, according to the site’s “Zestimate Accuracy,” Zestimates are within 20% of an actual sales price only 78.3% of the time (with a 7.9% margin of error).

For a $200,000 house, being 20% below would bring the price down to $160,000. Above, that price (which would make a seller happy, but not a buyer or appraiser), would be $240,000. That’s a tremendous difference!

Real estate is very local. Even street-by-street or neighborhood-by-neighborhood within a zip code can have majorly different values.

If you would like an accurate Towson home value estimate, please contact me. I can help you anywhere in the Baltimore real estate market area, or if you are in a different state, I can refer you to an agent anywhere across the country.

11615 Silvermaple Ct

It is on the market for $524,000.

11615 Silvermaple is a four bedroom home with a possible 5th bedroom and full bath in the lower level.

It has a large screened in porch with cathedral ceiling, updated kitchen with stainless appliances, hardwood floors throughout the first floor, plus a family room off the kitchen with wood burning fireplace. According to the public records, the square footage on the upper two levels is 2,198, with an additional 1,132 square feet in the lower level. It is a Ryland built home on a cul de sac.

This Hunters Run Colonial has so much to offer.

Currently there are three other single family homes on the market in the Hunters Run neighborhood at 11513 Hunters Run Drive for $530,000 (now under contract), and 1110 Walnut Wood Drive for $619,900 (now sold), which has now gone under contract, and 1210 Maple Leaf Ct for $505,000.

For more information on 11615 Silvermaple Ct or other Hunters Run houses, contact me. I know the neighborhood well!

Listing courtesy of Marcus-Boyd Realty

1210 Maple Leaf Ct is a four bedroom single family home in Hunters Run.

1210 Mapleleaf Court is a Ryland built Colonial in Hunt Valley Station, and is on the market for $485,000. According to the public records, it has 2,064 square feet on the first two levels. It has hardwood floors throughout the first floor, including the kitchen.

Located on a cul de sac, off of another dead end street, there is no through traffic! I actually sold their neighbor’s house at 1212 Maple Leaf Ct in 2009!

Currently, there are three other Hunt Valley Station single family homes for sale at 11513 Hunters Run Drive, (which recently settled), 1110 Walnut Wood Drive, which also recently settled, and 11615 Silvermaple Court for $524,000, now sold/settled as well. Multiple homes in Hunters Run have sold in the past year, and a competitive market analysis can be run to show true value. The styles & builders vary, so there are many details that go into figuring value on these homes.

Contact me for more information on 1210 Maple Leaf Ct and Hunters Run homes. I know the community well!

Home Listing courtesy of Yerman, Witman, Gaines & Conklin.

1110 Walnut Wood Drive

Located at the corner of Silvermaple, it has a convenient location & beautifully landscaped yard!

This is a Ryland “Calvert” model, the largest the builder built in the Hunters Run community.

Gleaming hardwood floors are showcased on the first floor, including the two story great room!

The owners have completely redone the kitchen, knocking out a wall and adding granite counters & beautiful cabinetry. This leads to the laundry room the garage.

The powder room right off the kitchen is nicely designed and tastefully done as well. The lower level has been finished with a bedroom and full bath, plus a recreation room!

Upstairs has been redone as well — the master bath has beautifully done tile work and marble.

This is a spectacular Hunt Valley Station house. Currently there are three other single family homes on the market in the Hunters Run neighborhood at 11513 Hunters Run Drive for $530,000, 1210 Maple Leaf Ct for $505,000, and 11615 Silvermaple Ct for $524,000.

For more information on 1110 Walnut Wood Drive or other Hunters Run houses, contact me. I know the neighborhood well!

Listing courtesy of Long & Foster Real Estate, Inc.

Brian Picker, one of my mortgage partners from 1st Mariner Mortgage, announced the return of the program and his company’s involvement in it.

Here are particulars on the grant qualifications from the information he sent over to me:

Details:

•            First Time Buyers Only (cannot have owned a home in the last 3 years)

•            Income Restricted to 80% of the area Median Income, based on Family size

-            All occupants over 18, income considered. Example – (1 person = $45,000 2 person = $52,000, etc.)

•            5 for 1 Matching Funds – UP TO $7500 Grant.

-            Buyer would need $1500.00 in the deal to get maximum allowed $7500.00.

*   Forgivable Grant over 5 years – pre-closing housing counseling required.

*   Funds CAN BE USED as Down payment requirements – for F.H.A. Loans

If you have been considering buying your first home in Towson or anywhere in the Baltimore real estate area, contact me, and Brian & I can help you figure out if this program will work for you!

11513 Hunters Run Drive

11513 Hunters Run Dr is a Faust-built Hunt Valley Station home with, according to the public record, 2,782 sq ft on the first two levels. It is listed for sale for $530,000.

The walk-out lower level has been finished with a fifth bedroom, full bath, and kitchenette.

This Hunters Run home has a fenced backyard, which is very unusual for the neighborhood. It has a nice, large deck off the kitchen as well with steps down to the fenced backyard.

Currently there are three other Hunt Valley Station single family homes for sale, one at 1210 Maple Leaf Court, listed for $505,000, another at 1110 Walnut Wood Drive for $619,900 (now under contract), and the third at 11615 Silver Maple Ct for $535,000.

Contact me for more information on 11513 Hunters Run Drive and other Hunt Valley Station homes. I know the neighborhood very well!

Listing Courtesy of Long & Foster Real Estate, Inc.

8 Winleaf Court is a Ryland built Colonial in Hunt Valley Station, and is on the market for $555,000. According to the public records, it has 2,962 square feet on the first two levels. The walk-out lower level is finished with a full bath and partial kitchen!

Located on a cul de sac, there are only 8 houses on the street. I actually co-listed and sold their neighbor’s house in 2005!

Currently, there are two other Hunt Valley Station single family homes for sale at 11513 Hunters Run Drive, on the market for $550,000, and 1110 Walnut Wood Drive for $639,900. Multiple homes in Hunters Run have sold in the past year, and a competitive market analysis can be run to show true value. The styles & builders vary, so there are many details that go into figuring value on these homes.

Contact me for more information on 8 Wineleaf Ct and Hunters Run homes. I know the community well!

Home Listing courtesy of D&D Real Estate and Development