Government’s spending cuts could have negative repercussions to overall U.S. housing market, according to Brian Coester, CEO of CoesterVMS
Brian Coester discusses factors contributing to stable housing markets on ABC affiliate
WJLA’s Washington Business Report
ROCKVILLE, MD (February 27, 2013) – Factors like limited inventory and high income earnings in areas like Washington DC, as well as Raleigh and Charlotte, North Carolina tend to insulate housing markets against the fallen home values seen in the rest of the country. These factors could protect values even against potential negative repercussions that could result from what the Obama Administration is calling “sequestration” spending cuts. This is according to Brian Coester, CEO of CoesterVMS, a provider of nationwide appraisal management services and technology, who addressed this topic using Washington DC as an example on Sunday, February 24 as a guest on the Washington Business Report, the business news program that precedes This Week with George Stephanopolous. http://www.wjla.com/articles/2013/02/washington-business-report-feb-24-2013-85539.html
“Home values are regional, even though they are often referenced as a whole across the U.S.,” explained Coester. “There aren’t any trends that impact every housing market to roughly the same degree. Certain variables make some housing markets more resistant to the country’s economic ups and downs than others. In those markets, issues like the government’s impending spending cuts won’t impact home values the way they can compromise home values in other markets.”
“The DC area is kind of an anomaly. You’ve got a very defined geographical area [and] you’ve got a huge number of high income earners,” Coester stated on Washington Business Report. “So the DC [area] never really had a huge downturn. If you look at areas like Vegas, a house was worth $600,000 and now it’s worth 100 [thousand]. In DC, [if] it was worth 600 [thousand], it’s now worth 500 [thousand].”
Washington isn’t the only geographic area that has demonstrated this level of resilience. “Raleigh and Charlotte, North Carolina are experiencing the same phenomenon,” Coester added. “Values have stayed comparatively stable, and we’re seeing steady appreciation since 2009. With these two areas, again, you have a distinctly defined area combined with high income earners.”
Another factor protecting housing markets against tumbling values is an increased demand from homebuyers who are now ready to purchase in the area. “We’ve got [mortgage lender] clients who are seeing a huge increase in purchase demands [and] a huge amount of increases in inquiries for purchases [in certain markets],” Coester said, explaining that this demand is the result of individuals who have been waiting “on the sideline” for the past three or four years. “There are a lot of reasons that some individuals are ready to enter the market at this time. Maybe they had some financial difficulties during the recession and they’re back on their feet. Maybe they have spent the last few years rebuilding their credit to be in a position to get a mortgage.”
Coester, a noted expert in home values, assesses property value trends based on actual appraisal data from the roughly 6,000 appraisals nationwide that are transacted by CoesterVMS each month.
About CoesterVMS
CoesterVMS is a nationwide appraisal management company that specializes in providing comprehensive management of appraisal operations for mortgage lenders. CoesterVMS’ in-house appraisal management solution combines the best service with the most advanced technology on the market. CoesterVMS guarantees all appraisal reports to fully comply with all regulations and guidelines. The company’s Cloud Control appraisal management technology is the only software of its kind to be built on the award-winning Salesforce.com platform, and its “Coester-Mer” service is earning the company a reputation for the best customer service in the industry. Headquartered in Rockville, Maryland, CoesterVMS was founded as a local appraisal company and has since grown to a formidable nationwide force in the appraisal management segment. For more information please visit CoesterVMS online at www.CoesterVMS.com.