Debbie Huber of Huber Appraisaland Home Pride Insectionsin Las Vegas is today's featured guest blogger. Debbie has been appraising residential homes in Las Vegas for over 20 years and holds the SRA designation (Senior Residential Appraiser). She is also a Past President of the Appraisal Commission for the State of Nevada.
Virtually any subdivision or extended market area can be studied using MLS to determine what changes (if any) have occurred in overall prices. To do this type of analysis in an abbreviated format, you can take the following steps:
Search the subdivision or area you wish to study, and enter the parameters such as subdivision name, map page, legal section, square footage range, etc.
Step 1: If you want to figure out changes in pricing over a 6 month period, enter status “S” for sold, any other parameters such subdivision name, square footage, etc., and for date of closing enter “past six months”. If you want to figure out changes in pricing over the past year, just enter status “S” for sold and it will automatically pull up the last twelve months of sales based all the other parameters you added to the search. Print out the results and indicate that you want the search criteria to print. This will give you the short report you will need to complete the analysis. Put this report aside.
Step 2: Enter the same parameters you had before as far as area, square footage, subdivision name, legal section, etc., but if you want a study of the past six months, change only the date of closing from “past six months” to “between”, and enter the two dates that will be the start and end dates of the closings during the previous six months. If you want a study of the past year vs. the prior year, change the status from “S” to “H” for history, and enter the closing dates to bracket the dates that would give you the closings during the previous twelve months. Print out this report as well, along with the search criteria.
Note: if you don’t have enough properties to result in enough data, (20+) broaden your search so it will include more properties. The less data you have to analyze, the more likely your study could be skewed or inaccurate.
Step 3: Compare either the median or average selling prices to each other on the two reports from the two different time frames. Subtract the median price that is the lowest from the two reports, from the median price that is the higher of the two reports. For example, the report from the past six months shows a $376,000 median selling price for what you were searching. The report from the previous six months indicates a $400,000 median selling price. Subtract the two figures to obtain the difference. Convert that to a percentage by dividing the difference by the median selling price from the “oldest” data.
In the example, that would be:
$400,000 - $376,000 = $24,000
$24,000 divided by $400,000 equals .06, or 6%
Since we did our two searches in 6 months increments, it shows there was a 6% decrease in predominant prices in the past 6 months, or 1% per month. If you did your two searches based one year apart, the resulting percentage will be the price decrease attributed to the past twelve months.
Remember, this is just a “quick” study to give you an idea of trends in pricing in the recent past. Also the more data you have, the more reliable your analysis will be.
This is an abbreviated way of studying price trends in order to better assist your clients.
To reach Debbie at Huber Appraisal, please call (702) 243-3256 or
email her at debbie@huberappraisal.com
To reach Home Pride Inspections, please call (702) 363-1681
m.harrison@homeprideinspections.com .
