The first task in writing this post was to look up whether "bullet holes" was 1 word or 2. Turns out it's 2 words. Learn something every day right? Or is it everyday?
Anyhow, I went to a bank owned property in Falls Church today.
It was disgusting. It was infested by cockroaches (we didn't see any live ones) and a bullet hole in the window (or a run in with a Kevlar beaked crow). What a gem!
The good thing was this client was able to see it as an opportunity, instead of being freaked out. Don't get me wrong, it wasn't my thing, but this isn't about me, this is about the buyer.
It got me thinking about how bank owned properties (and other dumps) affect neighborhood pricing. I've never really believed in broad market data that say that an area has gone up or down. See my UP 14%!? No, Down 26.2%!? DATA. What Is It Good For?
Market Increase??
So when I hear that DC's median price supposedly went UP, I believe an insider that tells me, "That is 
because the condo market stalled out, fewer condos are selling, so if homes (which cost more) are still selling, it will look as if the average is jumping."
Or Market Decrease?
Well the flipside to the DC example is also true too. If you have a community where a 2 bedroom 1,000 ft unit sold for $400,000 and then a year later a similar 2bdr 1,000 sqft condo sells for $350,000, did the area, drop 10% or is it perhaps... a $50,000 dumpier place? Yes dumpier.
So skip the headlines and dig deeper to find the data that you want.
These "average" numbers don't cover same-home-sales. They cover apples that sold in one area to oranges that sold in the same area.
With all of these bank owned properties, which tend to be dumps (not always), I wonder what part of the "average" drop is uglier houses selling, versus an actual drop in an area.
Here is a link to a photo album (which all buyer agents should do) of the bank owned property. (viewer discretion is advised)
- Written by Frank Borges LL0SA Broker FranklyRealty.com
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