VALUES: Hang on for a rough ride

I read with great amusement your article Wednesday regarding property values and how everyone hopes prices have stabilized.

They haven’t. They can’t.

Tucked into the article are these two little factoids:

“Foreclosures and short sales comprised 41 percent of residential transactions last year in Coeur d’Alene, the county’s largest group area, McDowell said. That was a jump from the 25 percent tallied across the county in 2010.”

Which are immediately ignored and wished away by the rest of the people quoted in the article. Everyone who relies upon real estate to make a living is saying we have hit bottom and the decline in property values is slowing down. Good time to buy.

Poppycock!

Every time a house in your neighborhood sells in a distressed manner, it goes for many thousands less than what is owed. If your house is valued at $200,000 and your neighbor loses his to a short sale or trustee sale for $160,000, guess what you now have. A comp. Your neighbor’s foreclosure just cost you $40,000 in stripped equity.

I encourage everyone to read about two court cases out of the Massachusetts Supreme Court called Ibanez and Bevilaqua. These type of situations are unfolding all across the country and it is only a matter of time before it shows up in the local judiciary.

Forty-one percent distressed sales — 16 percent increase year to year. Buckle up, ladies and gentlemen. Keep your hands and feet inside the car at all times.

It’s going to be a ride.

VERMONT TROTTER

Coeur d’Alene