Just How Valuable are “Property Values”?

By
Real Estate Agent with Americas Best Agents, Inc/Premiere Plus Realty, Inc BK417268

 

It’s a little bit like real estate’s Rite of Spring:  like new flowers ’s April sun in Pelican Bay. And since we are used to hearing how “property values” are still battling to rebound, this season the ‘Sale’ part of those signs is likely to be taken more literally than usual.

But since “property values” seems to be such an important measure, what is really behind the term? Who determines Pelican Bay’s “property values” – and how?

We aren’t just talking about some abstract Econ 101 textbook definition of economic principals. We are dealing with a family’s major investment – their current or future home. So it’s valuable to make a mental distinction between that notion of ‘property value’ and other, less abstract terms. Like “price”.

In a nutshell, “property value” can mean different things to different people -- and even different things to the same person! To a homeowner, for instance, it can be the amount of money he or she can sell it for (its “market value”), or the value it has if he or she don’t sell but continue to use it as a place to live (its “use value”). To a lender, it usually means current market value; to a pure investor, property value might be its future value or its liquidation value, -- which would also vary depending on whether they are thinking of some possible future forced liquidation or an orderly liquidation. In other words, “property value” is a term that can mean so many different things that it is not terribly useful.

So the next time you hear a commentator talking about “rising property values” or “sinking property values,” be ready to take what they are saying with a grain of salt…or possibly a shaker-full. Property values are not anything like “price”, “asking price,” or “selling price.” Those terms can have real numbers attached!

In case you have been thinking about buying or selling a property, give me a call at 239-591-3225 or email me at

ginnylee@ginnylee.com.

 Prices are going up- and the market’s ready! If you are thinking of buying ....buy now before prices go up!

 

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Topic:
ActiveRain Community
Location:
Florida Collier County Naples Pelican Bay
Groups:
Advice for Buyers
Advice for Sellers
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Tags:
home sellers
retirement home buyers
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florida beach front
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Ambassador
625,691
Doug Rogers
Your Pineville Louisiana Agent
Bayou Properties Realty

The value of that beach view? Priceless!

March 27, 2012 06:21 AM
Rainmaker
188,241
John F Muscarella
Broker/Owner, Plymouth County / Cape Cod, MA
RIVER FARM PROPERTIES, LLC

Good post and a term to always ask for a definition from the person making the statement.  In MA we are having a to do over assessed value and market value.  WHile towns suffer with their budgets assessed values can mean many things as well when compared to tax rates.

March 27, 2012 06:32 AM
Rainmaker
152,352
Ginny Lee
CRS, Realtor, CDPE & ASP,Americas Best Agent,Naple
Americas Best Agents, Inc/Premiere Plus Realty, Inc

Doug you are absolutely right...the beach is priceless!

John I am so glad I don't live where you do...

March 27, 2012 09:01 AM
Rainmaker
199,394
Shannon Lefevre
Shannon Lefevre, PA Your Naples Smart Girl
John R. Wood Properties

Hi Ginny,

I can't get over how popular the Pelican Bay beachfront is this year!!!! It's so funny how when all of a sudden there's an undersupply, the more valuable property is perceived... What a rollercoaster we are on!

Hope you're having a terrific year!

March 29, 2012 07:24 AM
Rainmaker
152,352
Ginny Lee
CRS, Realtor, CDPE & ASP,Americas Best Agent,Naple
Americas Best Agents, Inc/Premiere Plus Realty, Inc

Thanks so much Shannon...Hope You are having a Terrific Year too!

My sales are way up....I just keep counting my blessings! We Live in Paradise and everyone wants to live here!

March 29, 2012 07:38 AM
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Rainmaker
152,352

Ginny Lee

CRS, Realtor, CDPE & ASP,Americas Best Agent,Naple
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