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RESPONSE TO THE AREA REPORT

by Katherine Guidry, President
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 report..

A call to Joe Quintana revealed his office was also not contacted.

Not 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 the Kressins.

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 a burn..

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.

 

 

Palo Verde Appraisals, Inc.
Katherine Guidry, President
P.O. Box 4730, Los Alamos, NM 87544
Office: (505) 662-3777 Fax: (505) 662-3777
Email: PaloVerdeApp@aol.com

http://www.PaloVerdeAppraisals.com

Copyright © 2005 Palo Verde Appraisals