Thursday, December 20, 2007

Real Estate Value Problems

"As the housing market slump deepens, disguised discounts are making it harder to tell exactly how much people are paying for homes. ... But incentives offered to buyers ... are making [county sale records] less reliable as a sign of what buyers actually paid, netting out the giveaways. ... But mortgage-fraud experts say the rebates are often designed to fool lenders into making bigger loans than they otherwise would", WSJ, 19 December.

The article cited a townhome that valued at 14% "above the net price paid by the buyer". The real estate slump may be more severe than many people think.

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