Real Estate Sales Research and Analysis

1
Real Estate Sales Research and Analysis
2
WHATS IT WORTH
3
Sources of Sales Data
4
Discovery Sources

• Deed Info
• Mechanics Liens
• Building Permits
• MLS and other Listing Data
• Realtors Fee Appraisers
• Closing Statements
• Mail out surveys to buyers sellers
• Publications
• Internet

5
Deed Info

• Why research deeds? Change of ownership
  (survey), possible deed of trust with note
  amount, could signal that a property that was in
  a state of deferred maintenance is about to be
  rehabbed, confirmation of sales, ownership
  interests, helps the appraiser keep their finger
  on the pulse of the local market.

6
Deed Info

• If purchased by a known builder/contractor, could
  signal demolition of structure and construction
  of new home.
• market trends
• economic development
• revitalization (residential/commercial projects)
• investor/flips for fixer uppers
• gentrification
• development from raw land
• out of state buyers (with renovation/appreciation
  in mind)
• change of highest and best use

7
Mechanics Lien Info

• Signals there are about to be new or additional
  improvements to property
• An Indication of value associated with
  improvement

8
Building Permits

• Building permits help to establish a completion
  phase of a building project.  They are required
  for houses that need to be moved, fire damaged,
  demolitions, new construction, renovations and
  additions.  They establish that a project
  is meeting the building and land development
  code requirements.
• Discovery source for new or additional
  improvements or renovations
• Generally required in incorporated cities
• Bexar County issues septic permits in rural areas
  not on central sewer
• Electrical Connects often signal new construction

9
MLS Data Processing

• Sales are pulled from the MLS on a weekly basis
• Sales are separated by Commercial, Residential,
  Rural, and land sales
• Sales are further separated by Residential Single
  family residence, Residential Multi Accounts,
  Condominiums, and Residential vacant lots. All
  out of county sales are separated from this
  batch.
• Sales are researched for account numbers and
  neighborhood codes.
• All information is verified such as financing,
  concessions, parcel addresses, square footage,
  beds, baths, fireplace, exterior, roofs, and
  other amenities. The remarks that are provided
  on MLS are read and compared to the records that
  Bexar Appraisal District has. All discrepancies
  are reviewed by the team supervisor in order to
  decide whether a field check is warranted.
• All sales that need field checks are loaded on
  the building permit screen as field checks.
• All sales are loaded to the sales file and
  distributed to appropriate field teams to be
  worked.

10
Fee Appraisals

• Good source of sales data
• Many times contain non-disclosed sales
• Can sometimes be obtained from governmental
  agencies who are acquiring properties
• Often able to obtain/verify characteristics such
  as square footage, etc. on comparable properties

11
Closing Statements

• Wealth of information if analyzed correctly
• Key is in determining what the statement is
  actually telling you
• Can be a seminar all by itself
• Many an appraiser has been duped by a closing
  statement

12
Mail Out Surveys

• Buyer_Name
• Addr_1
• Addr_2
• Addr_3
• City State Zip-Zip__4
• SALES CONFIRMATION SURVEY
• Property IDs, Location and Description
• - GEO ID geo_id PROP ID prop_id NBHD
  REGION Region
• - PROPERTY LOCATION situs PROP USE
  Property_Use
• - LEGAL DESC Legal_Description
• Our records indicate that you recently purchased
  the above property. The Texas Property Tax Code
  for the State of Texas requires the Appraisal
  District to appraise property at its market value
  as of January 1st of each year. We are in the
  process of conducting a sales study to assist
  with our appraisal mandate. Please provide the
  following information about your recent purchase
  at your earliest convenience. Thank you for your
  help.
• OUR RECORDS INDICATE A DEED DATE OF deed
  date
• SALE PRICE ________________________
  AMOUNT FINANCED _________________
• TYPE LOAN CONVENTIONAL FHA
  VA OWNER FINANCE CASH
• If you purchased a new home from a builder, did
  you purchase the STANDARD model or an
  UPGRADED
  model?
• Please circle one STANDARD UP
• If UPGRADED, what was the ADDITIONAL cost?
  _______________________

13
Publications

• San Antonio Business Journal
• Commercial Recorder
• SA New Homes
• Texas Monthly
• Wall Street Journal
• Christies Great Estates
• Historic Preservation Magazine
• Foreclosure Reports

14
Internet

• Various Real Estate websites
• County for deed/ownership research
• City websites for building permits and historic
  district information
• Local newspaper- real estate listing and articles
• Community websites for upcoming home tours
• Contractor/Builder websites for new
  construction/sales information
• City (GIS) Geographic Information Systems
  websites for zoning
• Other (neighboring) Appraisal District websites
• State Comptroller website
• Google website for miscellaneous occupational
  research

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Gather and Verify Sales Data Record Sales
Data Arms Length Concessions terms of
financing Is current use highest and best
use Verify characteristics on sale vs. current
parcel record Know Your Sales Know Your
Market Local Regional National Marketing
Time
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Bexar Market Info

• 36157 Residential Properties listed for sale in
  MLS From January 1 thru October 15
• 18204 had sold
• 12950 sold for less than 200,000 currently 7379
  active listings or 5.5 month supply
• 4698 sold for 200,000 - 500,000 currently 3965
  active listings or 8 month supply
• 488 sold for 500,000 - 1,000,000 currently 863
  active listings or 17 month supply
• 68 REPORTED sold over 1,000,000 currently 219
  active listings or 30.5 month supply

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Settlement Statement
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Closing Statements

• What type of loan is it?

Are buyer and seller related? Check addresses
Is there any personal property?
Note loan amounts and possible owner finance
How many years of taxes due? Distress sale?
Is seller walking away with ? Distress sale?
Is this the right property?
19
Closing Statements
Were there commissions paid?
Was there an appraisal? Where is it?
Is owners title coverage same as sale price?
Examine additional settlement charges paid by
buyer or seller
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WHATS IT WORTH
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High Value Residential Challenges

• Often homes built to express individuality of the
  original owners
• May be limited buyers
• Regional or National market
• Lengthy marketing time
• Establishing sales database
• Replacement cost difficult to determine
• Functional obsolescence
• Highest best use analysis
• Often involve historical significance