Tuesday, April 22, 2014

Then and Now: Residential Appraisal Comparison

Then and Now: Residential Appraisal Comparison

By: Loren Castro

The property at 1225 E. Santa Ana Avenue, Fresno, California, also described as the East 90 feet of the West 190 feet of the South one-half of Lot 29, Warnekros North Fresno Acres, Count of Fresno, California, was built in 1951. This 2,231 square foot single family home has 3 bedrooms and 2.5 bathrooms. It currently sits on approximately 12,096 square feet or 0.28 acre lot. Very much has happened in the real estate market here in Fresno from 1962 until today. I will discuss what the price of this home was back in 1962 and then use current market data to get a value of the home as it is today.

        The Mark Massie appraisal was done on March 16, 1962. The picture on the right is what the house looked like when he did the appraisal.  The property is leveled to grade; there are walks and brick planters, but no curbs or sidewalks. The property is fenced with grape stakes and is landscaped with trees, shrubs, and lawn areas. The property also has a swimming pool of a “Lazy-L” shape with wrought iron fence, which takes up approximately 1/3 of the backyard. This report is a seven page report. He used six comparable sales that ranged from $18,000 to $29,000.  These comparable sales helped him come up with the appraised value of $26,000 for this property in question.  Those prices have obviously changed due to inflation as you can no longer buy a property like this for that value. $26,000 back in 1962 would be $201,550.39 today.

            It is nearly impossible to acquire a good picture of what the current property looks like as the large tree in the front yard is now overgrown and taking up most of the properties view. It is stated that the current neighborhood, among Bullard Homes, is valued 41.2% more than the median home, and is valued 12.9% more per square foot. It is also stated that foreclosures will be a factor impacting home values in the next several years. In the Bullard market, the number of foreclosure waiting to be sold fell 39.3% in the last year. The number of unsold foreclosures is 28.8% lower than in Fresno, and 27.8% less than the national average. This lower local number could help Bullard home values rise more quickly than other regions in Fresno. This is great news for this property and this neighborhood.

            From current property records there has been no major additions or changes to this property physically since it was built. It is also noted that this one story home features good quality construction, suggesting that it was built with high quality materials and craftsmanship, which likely has a positive impact on its overall value. Also, the most recent assessed value for this property was $232,877. This assessed value was recorded in 2013. The total assessed value can be broken down into a $51, 256 land valuation, and an $181,621 improvement valuation. Based on this information I would appraise this property at a total value of $312,000. I gathered this number from two nearby similar sales in the last year. One similar property on the same street, two blocks down, sold for $340,000 just last May. This compared property sits on a slightly larger lot, has .5 more bath, and has approximately the same square footage as the property in question. Another property just down the street as well sold for $340,000 in March of 2013. This property has 4 beds and 3 baths with a larger lot as well as square footage and has been recently updated. Its assessed value in 2012 was $278,307, so this area as well as its updates has helped this value go up extensively in the last year.  

            I really enjoyed looking at the past and present value of this home. It is really interesting that the value of $26,000 in 1962 is $201,550.39 today. Which means that if the owner in 1962 sold the home today for $312,000 they would come out with a profit of $110,450.


Monday, April 21, 2014

1345 N Del Mar Avenue


         The appraisal of 1345 North Del Mar Avenue was conducted by Mark Massie and published on October 14, 1966. The structure sits on Lot 25 of the East Elmhurst Tract, as described in City of Fresno’s Record of Surveys Book 7, Page 17. According to the County of Fresno’s Assessor’s Map, the property is located in Book 451, Page 19, earning it APN#451-194-08. Facing the subject property from the N Del Mar Ave, the lot is 50 feet wide and 138 feet deep, making it 6,900 sq. ft. or .158 acres. The structure on the property is a two bedroom, one bath, 1,065 sq. ft. single-family residence, constructed in 1924 within a densely-populated suburban area of Downtown Fresno. The neighborhood is located about a mile north of Highway 180 and about two miles west of Highway 41. According to Massie’s report, the area consisted of mostly middle to old aged people, earning around $3,500-$5,000 per year. 
         Massie first used the sales comparison approach to determine the land value of the property in question. He compared five recent sales of properties in the area that had similar physical characteristics. The top three comps used, in my opinion, were sales A, B, and E. All three properties had the same size lot as the subject property and had similar improvements to the land. Sale A’s land value was $2,750, which was under market value because it was roughly 100 feet from an elementary school playground. Sale B was sold at a premium of $3,350 for the land because of a father’s desire to live next door to his daughter. Sale E was the property adjacent to the subject property, making it the best comparison. Sale E’s lot had a value of $3,000, which is the value that Massie would use for the land to appraise the subject property.
         The Cost and Market Approaches were used to determine the value of the improvements on the subject property. In the Cost Approach, the replacement cost of improvements determined by Massie was $9,475, not including landscaping. Since this is the value of the improvements assuming they were brand new, he then had to account for depreciation of the improvements. Physical depreciation of the property accounted for nearly half of the overall depreciated value, mainly because of foundation settling in the rear of the structure. The subtotal for the building and improvements was determined to be $5,255, which was added to the land value of $3,000 to get an overall property value of $8,255. The Market Approach was then used. By comparing the subject property to current market data and seven recent sales of other properties in the area, Massie determined the value of the property to be $8,000.
         In 1996, Massie appraised the subject property to be $8,000. According to the CPI index, one dollar in 1966 would be worth $7.25 today, making this property worth $58,000 today. Using MetroScan, I was able to determine the current market value of the property to be $47,722, $19,086 for the land and $28,636 for the structure and improvements. This would make since due to depreciation of the property throughout the years. According to zillow.com, the property could potentially sell for $101,000. This is low compared to other homes in the neighborhood. I believe that many homes in the area have been remodeled or rebuilt since the 1920s, because Massie reported the knighthood to have mostly two bedrooms and one bathroom. When looking on Zillow, many of the homes in the area are listed has having three, four, or even five bedrooms and multiple bathrooms. This could affect the desirability of the home, causing it to have a lower value.
            I really enjoyed this report because it was very interesting to get a detailed description of a property in the 1960s. It is amazing to think a home was once valued at $8,000. It also goes to show how old parts of Fresno are becoming and the potential future problems that will cause as commerce and activity keep moving to the northwest area of Fresno. Below is what the property looks like today. Unfortunately, the picture of the property from Massie’s report is missing from his appraisal so it is difficult to compare the difference from then and now. By the looks of the structure, it doesn’t look like it has been remodeled in recent years. Because of this I believe the property would sell today for just under $100,000.

Sources Used:
-       Appraisal Report by Mark Massie (1966)
-       Zillow.com

-       MetroScan Property Software

Monday, April 14, 2014

Median Price of SFR Home Listings Sold in Fresno & Clovis at a 12 Month High

The median price of SFR home listings sold in Fresno & Clovis increased by 28% from March 2013 to March 2014.   

If you have any questions on his information or want specific information on the Fresno/Clovis Real Estate housing market, please contact Greg Maroot at 559-994-0254.

Maroot Properties herein deemed this information is reliable but not guaranteed; representations are approximate, individual verification recommended. Real property transactions information listed above is limited to Fresno MLS listings and may exclude total number of real property transactions which occurred in the marketplace

Wednesday, April 9, 2014

Fin 181 BP: Commercial Site

Commercial site
The property that I will be discussing today was an appraisal that took place March 6, 1962 on block 274 of Fresno city, located at the southwest corner of Fresno and "B" streets, Fresno, California. Mr. Harris had requested an estimate of the current market value on Lots 1, 2, 3 and 4, 150 front feet and a depth of 100 feet. Mark Massie a local appraiser with Miles, Andrew & Cullington Inc has provided his procedures on why the property is with $25,000. Finally I will close with information that I found on the property in today's market.
At the time of the appraisal, March 1962, three houses were located on this lot, since it was a residential area at the time the houses were built. This property was in a gradual transition from residential to commercial and light industrial land users. There was very little real estate activity happening in this area.  For example there were only two roughly comparable properties that had recently sold in 1962 in that area, but were not on the main street.  With that being said Block 274 was appraised using the Highest and Best Use method of the land for the commercial nature.  Mr. Massie chose two commercial properties to support his appraisal, a Shell Oil Company and a single-story brick store building.
The Shell Oil Company is on the corner of Fresno and “C” Street with close proximity to the on and off-ramps of Freeway 99.  Therefore this corner has greater traffic flow. September 1958 the land was purchased for $42,000, a 160 front feet length and 150 feet depth, based on a $225 per front foot.  The single-story brick store building located on Fresno and “A” Street was purchased in September 1959 for $25,000. The building itself was estimated to be worth $13,000. The building had 100 front feet with 135 feet, and estimated the property at $120 per front foot.  Since Block 274 lies between the two properties Mr. Massie to into consideration the various factors and concluded that the value of the subject property is valued at $165 per front foot.
Harry F. White Estate the owner of lots 1, 2, 3, and 4 on Block 274 had a property area of 15,000 sq. ft. in zone c-6, Heavy Commercial. The latest information that I found on this property was in February 2002 Mr. and Mrs. Luh had purchased the property for $372,954.00. The zoning and square footage remains the same, but two business, Radio Shack and Advance Amerixca that lease the buildings, have replaced the houses. If this retail property was on the market today Loopnet.com has appraised it at $1,200,000 a $283.02 price per sq. ft. which is a little high compared to the $179 price per sq. ft average in Fresno retail asking prices.

In conclusion I believe that property would have been a great investment back in the day since I was able to also see that Shell’s Oil Company was in business until 2011, until they sold in March of 2012.  Even then a $42,000 property that was sold for $1,750,000 and the subject property at $25,000 selling for nearly $373,000 is a good investment.

Work Sited

Friday, March 28, 2014

Fresno & Clovis Home Pre-Foreclosure Inventory Up (Feb. 14)

The total number of Pre-Foreclosure Home Inventory in Fresno & Clovis increased 5% from February 13 to February 2014.  Pre-Foreclosure inventory is an estimate of the number of properties that have had a Notice of Default filed against the property, but have not yet been Scheduled for Sale.

If you have any questions on this information or want specific information on the Fresno/Clovis Real Estate housing market, please contact Greg Maroot of Maroot Properties at 559-994-0254.

Maroot Properties herein deemed this information is reliable but not guaranteed; representations are approximate, individual verification recommended. 

Thursday, March 27, 2014

Gazarian Center Real Estate Sentiment Index Report - Spring 2014

Thank you to everyone that participated in the Gazarian Center Real Estate Sentiment Index Survey. Your participation is greatly appreciated!

Here are the results of the Spring 2014 survey.

Wednesday, March 26, 2014

Welcome Home Radio Podcast

Please click the link below to listen to the most recent Welcome Home Radio podcast featuring:

Dr. Andrew Hansz, Director of the Gazarian Real Estate Center
Diane Ray President of the Student Society of Real Estate
Cameron Scheidt, Real Estate Student and Winner of the 2014 Elevator Pitch Competition 


Workshop and Industry Panel on High Speed Rail: A Systems Approach

Workshop and Industry Panel on
High Speed Rail: A Systems Approach

Monday, April 7, 2014

University Business Center
California State University, Fresno

The Lyles College of Engineering and the Division of Continuing and Global Education at California State University, Fresno present "High Speed Rail: A Systems Approach", a technical professional development workshop for practicing engineers, construction managers, planners, policy makers, and others interested in learning more about the systems approach towards high speed rail implementation.

This workshop will be followed immediately by an industry panel and a reception presented and sponsored by the Fresno County Economic Development Corporation and Precision Civil Engineering. Jeff Morales, Chief Executive Officer, of the California High Speed Rail Authority (CHSRA) will be a panel guest.

For detailed event information, click here.

You may also contact the Office of the Dean, 
CSUF Lyles College of Engineering at 559-278-2500.

Tuesday, March 25, 2014

Then and Now: Grail Fernwood Shell Oil Company Appraisal

By: Joshua Tabers

Although this is the Mark Massie appraisal assignment, the appraisal report that I studied was done By Grail O. Fernwood, a colleague of Mark Massie, in 1961. The property was a 120’x150’ parcel on the southwest corner of Palm and Bullard Avenues in Fresno. This appraisal was done for Shell Oil Company and their interest of building a service station. At the time, the parcel was just a vacant lot and the area surrounding it was farmland. To the east and northeast was developed land. At the north east corner of Palm and Bullard there was already a functioning service station and the lot on south east corner of Palm and Bullard had been approved for a service station. An appraisal was done for the value of the land and also for the value of the property with a service station.

Grail Fernwood used the sales comparison approach method for his appraisal. The appraisal for the land value was $3,000 which was based on the prices of other properties with consideration of the conditions of the property. The property needed minor grading and had good drainage and visibility as well as accessibility to gas, water and electricity. For the appraisal of the proposed service station, Fernwood looked at the selling prices of 10 different service stations that sold in past years. He also looked at the asking prices of 7 different service stations that were on the market at that time. Along with that, he researched 8 different service stations that were being leased with 1 of them being the service station on the north east corner of Palm and Bullard Avenues. With all of this information, Fernwood came up with an appraisal for the proposed site to be valued at $45,000.

Through countless research, I was unable to find any evidence that Shell Oil Company carried out the service station on the southwest corner of Palm and Bullard Avenues. Currently, there is a Valero Gas Station on that corner with the property that Grail Fernwood appraised nearly 53 years ago. Since there is currently a gas station on that same property Fernwood appraised, it is fair evidence that Shell Oil Company built their proposed service station. Although the highest and best use for this property was not requested for this appraisal, a service station may have been its highest and best use since there is one there over half a century later.

According to findthebest.com, an estimated current value for the property is $1.51 million with the value of the land being $470,456. The last selling price was $780,000 which was on March 7, 2001 and the last major renovation was in 1989. The property value of $1.51 million seems high compared to the last sale and also what other gas stations in the area are selling for. At the current inflation rate of 3.96% the property would have been appraised at $360,983.25 and the land value would have been $24,065.48 which are much lower than what the values estimated today. This property value would have increased by 418% which would have been 8% per year. Although this is, improvements and maintenance on this property would make this amount lower.



Grail Fernwood: Shell Oil Company Appraisal.

Ratterman, Mark R., MAI, SRA. The student Handbook to The Appraisal of Real Estate, 13th edition. 2009.