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Homeowners — Is Your Home About to Lose Value? Here are 4 Signs

1. Number of Homes Lingering on the Market

When “For Sale” signs linger in a neighborhood for three or more months, that may mean buyers and sellers can’t agree on a price. In that environment, homes are unlikely to sell unless the seller lowers their asking price.

2. Number of Foreclosures in Your Neighborhood

The quickest way to end up underwater is to live in a neighborhood that’s plagued by foreclosures.  Because when you need to sell your house all the comparable sale prices and current for sale prices will be depressed since banks want to get rid of these houses. 

As homes go into foreclosure, they create a domino effect, lowering home values throughout a neighborhood in a cascade beyond homeowners’ control.

3. Rising Unemployment

A strong local economy or stable job market increases a demand for housing since more people want to and can afford to live in that city.  However, the cities with the highest unemployment rates are where homes have lost the most value during the past year.

People living in areas with high unemployment are likely to see their home values drop further, especially if they live in areas dependent on dwindling industries – like Detroit and the auto industry.

4. Homes in Poor Condition

Dented siding, high grass, broken windows, peeling paint, crumbling brick and broken porches could be signs that neighbors are having trouble making ends meet and can no longer pay to take care of their home. Or homeowners may have gotten an appraisal and discovered their homes have dropped in value and are no longer worth the cost of updating the house. As anticipated, as the condition of homes in your neighborhood worsens, home values are likely to drop.


February 24, 2010 - Posted by | Uncategorized | , ,

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