TO THE AREA REPORT
Palo Verde Appraisals, Inc.
A report just completed
for FEMA by the Applied Real Estate Analysis group from Chicago,
Illinois was presented last week as a comprehensive look at The
Impact of the Cerro Grande Fire on Housing Values in Los Alamos,
New Mexico as of August, 2002.
According to Kathy
Keith, director of the Federal Emergency Management Agency's Office
of the Cerro Grande Fire Claims "AREA really took a hard look
at the facts".
The report states
that these specialist talked with bankers, appraisers and brokers
as well as officials from the Los Alamos National Laboratory and
the Los Alamos County.
My curiosity was peaked
since I, as an appraiser, never received a phone call from these
people. When I asked why this was to the people from AREA at the
presentation meeting I was told they couldn't call everyone.
That evening I received
a call from Bill Redmond and among other things I asked him about
his participation in this report. His response was that he was never
called and neither was Paul Kressin. Hmmmm that would make 50% of
the appraisers in town not contacted.
The next morning I
called Don Dunning's office and spoke with Kerry Dick. She told
me that their office was never contacted by AREA. The Price Waterhouse
appraisers had spent a significant amount of time in their office
going thru their files for historical and current data for the previous
A call to Joe Quintana revealed his office was also not contacted.
one appraiser in Los Alamos County was contacted by a report
that presents itself as a comprehensive look at The Impact
of the Cerro Grande Fire on Housing Values in Los Alamos.
Don Dunning has been
appraising in this community for 20 or 25 years with an extensive
data base going back that far.. Kerry Dick, his assistant, has been
with him for a good amount of that time.
I have been appraising in Los Alamos county for 13 years as have
Joe Quintana has been
appraising since the beginning of time and I am sure has an extensive
data base. He also has been on the New Mexico State Appraisers Board.
Bill Redmond is currently
working on his license and hopefully will be a licensed appraiser
by the end of the year if he passes his state exam.
All of these people
seem to be a wealth of resources for a report that is supposed to
be about housing values in Los Alamos County. This report does not
represent input from 100% of the appraisers in Los Alamos county.
The question is why
not since these are the people who perform this work professionally
on an ongoing basis..
Before this issue
came up with the appraisers I was interested in how the report would
deal with the 415 million dollars put into the recovery effort of
this community of 18,000. There are 8,000 residential and business
properties in Los Alamos county according to the assessors office.
Doing simple division that is an increase of $50,000 of purchasing
power per per property in the County. One of the fundamentals of
real estate appraising is understanding the inflow and outflow of
monies in the market your appraising. Having an additional $50,000
of purchasing power would help anyone in the buying market. It is
a false spike of an increase from an entity leaving our community
at the end of the month.
For this AREA report
to not comment on this money and its effects on this market is like
having an 800lb gorilla in your living room. He is smelly and swinging
his arms and hitting everything in site and you cant miss that he
is there. There is no question the FEMA money distorted our market.
To what extent we just don't know and this report doesn't tell us.
I sent this report
out to John Widdoss of Hall-Widdoss in South Dakota.. That office
has consulted or valued properties that have been affected by fire
in many of the states in the West . His comments were that it is
rare to find a property that doesn't have diminutive value from
That FEMA has had
a difficult problem in trying to make this community "whole"
again is obvious. But it is an insult to everyone involved to present
a report that claims to be a snapshot of the real estate market
and not mention the money affecting the numbers or to have communicated
with any of the local real estate appraisers.
The continual list
of heros in this fire aftermath have to include the real estate
and banking professionals that have had to work around this huge
gorilla in our living room.