Happy New Year readers. I hope you had a wonderful holiday.
It seems that the spirit of New Year makes us want to assess where we are so we can make plans going forward. I get many inquiries in the beginning of January asking that I stop by and assist with market analysis for various subdivisions. Homeowners are contemplating if a sale might net them the amount that they desire.
From time to time, a potential seller might want to know if the market is “back”. Although you hate to always qualify your answers with “it depends”, pricing performance does vary from area to area, when the property was purchased and the current condition of the property. With those factors, answering that question has to be on a case by case basis.
If you are ok with looking at the Kansas City Metro market in broad terms, however, there is some good news to report. The Federal Housing Finance Agency compiles a Housing Price Index that reports changes in home appreciation rates on a quarter by quarter basis.
Based on our region, we were producing positive (greater than zero) quarterly percentile gains up until the 3rd quarter of 2007. The following quarter dropped to the negative and we did not return to positive quarterly percentile gains until Q1 of 2013. That is twenty one consecutive quarters. I can’t stress enough that this is a regional assessment. You might be saying that your subdivision is back and you might be correct. Still, there are areas of our region that still have too much foreclosure inventory putting downward pressure on pricing and that is also being factored into the broader average.
So lets take an example. The Federal Housing Finance Agency has a nifty calculator that helps to assess purchase price and subsequent gains or losses. Click here to check it out.
Based on this calculator, a home purchased for $200,000 in the 3rd quarter of 2007 would have had a valuation in the Q3 2013 of $187,894. A home purchased for $200,000 in the 3rd quarter of 2009 would have a 3Q 2013 valuation of $219,456. Finally, a home purchased for $200,000 in the 3rd quarter of 2011 would have q 3Q 2013 valuation of $223,735.
On average, the trend for our area is quite positive. I know that I’ve stressed the broad nature of this information endlessly, but it is well worth your time to get a professional market assessment of your individual property to determine where you stand.
Feel free to contact me if you’d like me to assist or if you have any questions.
Realtor — Reece and Nichols Town Center
Licensed in Kansas and Missouri