Questioning Whether the Value of Your Property Will Rise...or Fall? Part I

Did you just purchase your property? Say you just bought a property and it wasn't through anyone person in particular, it was just on the regular market. It was with a builder who was offering a whole lot of discounts to move the property before the end of the year in a new development. Your problem-you had to have it titled in your name rather than in your LLC. nnWhy did this happen? Maybe it seemed simple enough at the time. Maybe they were paying all closings costs. In fact there weren’t any closing costs. So the next logical step would be to go to the bank and get a loan. Now if they were going to owner finance the whole thing then you have a whole new ballgame. Say they financed it at only 4.25% for five years. And then they are paying all closing costs; the only thing you would have to do is pay four months of taxes and one year of insurance. nnAnd keep in mind you are paying retail price!nnSo where does that leave you. You my friend are sitting pretty. They have drastically discounted the house. You should be sitting pretty right…..right? nnBottom line-it doesn’t matter what they did and you shouldn’t care either. You should care more about what it is really worth. And the truth is- you would be foolish to buy this house without getting your own appraisal. Don't you accept anything that builder gives you to determine the value of this property. nnYou are not talking about small change here, right? Maybe the house is worth $400+. Get an appraisal and you should hire your own attorney to work this deal through with you so you don't get stuck. You must have a good title insurance policy. nnAlso, you will need to get it appraised and you need to make sure that there is not something here that you don't know. . . and your biggest concern is what is it really worth, what are you paying and what is it going to be worth shortly? nnAnother thing to look at is the area. This is a huge mistake people make!nnAre the houses continuing to go up in value there? Or are they leveling nnAnd make sure when you hire the appraiser (in fact this is huge-you must be the one to hire the appraiser-no one else!) And you must have a conversation with this appraiser. You call the appraisal, you tell him you want a market analysis of the appraisal and the value and do not tell him what you paid. nnIt’s that simple! You get that appraisal in your hand and then you decide where to go from there. In part II we’ll see what happens when we try to title this! n