All right so two and a half years ago I bet my friend his house would drop in value 40%. He lives in Wilmington, Delaware. The values there rose pretty high....I think about 50%. Well the national average decline in home prices is around 13%. Every major area has been hit and they are calling for no end in site. Prices could drop another 25%. read this article http://money.cnn.com/2008/04/29/real_estate/housing_price_fall_deepens/index.htm?ref=patrick.net Get this he claims his house has appreciated 7%. I don't think I have to say anything else.....give me your feedback please.
He could be right. Real estate is very localized. I'm an appraiser and I can tell you one thing for certain. National, regional, even citywide "averages" are meaningless. Some of the areas I cover have dropped 10% while others are stable and still others show modest increases over the past year. It all comes down to the type and quality of the house and the neighborhood. Nice houses in really desireable areas are still selling within days.
He lives in a small three bedroom row house with no backyard. I mean come on a 7% increase That would put his house at 215K
There is no way real estate in Wilmington, DE. is up 7% Anybody know where I can find a stat on real estate depreciation in Delaware
You're missing the point. He could be in a neighborhood that is appreciating no matter what the "stats" for greater Wilmington say. Or he could be in one that is delcining more than the stats indicate. All of these quotes you hear about values are based on very large samples. It's like saying I have one foot in boilng water, and one in freezing water, so on average, it feels just fine.
Go to the online real estate section of a local/regional newspaper and look up recent home sales on your friend's street and nearby vicinity. You can then compute sales gain percentages and compare recent sales to older sales in order to gauge the condition of the market.
Sounds like you want your friend's house to collapse in value,with friends like that who needs enemies?
OK, I'll give you my feedback. My feedback is that perhaps you should spend more time trading and less time thinking of ways to jam your "friend." Schadenfreude?