Houston Real Estate Blog

Over the last 10 to 15 years, people in major cities throughout the United States have been returning to the inner city as a place of residence and the city of Houston has join in this trek back to downtown as well.

Many urban and regional planners set sort of a flowery, “it takes a village” milieu to the whole process by stating that people return to the inner city because it reflects the character of the town and a need to return to roots. However, there are far more down to earth reasons why this is taking place.

Kevin Byrd, a Masters Degree candidate at Virginia Polytechnic, states that people in the United States lived in tight communities for decades because of the convenience of goods and services. Living near the rail road tracks or a vital port was not seen as a negative. Separating yourself from a town or city meant going in to the deep, dark unexplored wilderness which was not good for those who were poor with a long rifle.

The invention of the automobile in the beginning of the 20th century; most especially after World War II, enabled people to escape the downtown area for a more suburban lifestyle. Relative to this factor, land values began to rise, and land consumption took place at a rapid pace. As the population rises and the city spreads in size, the infrastructure must stay at least at a level pace with this growth, which it usually not the case. Where the infrastructure stops, so does the suburban growth.

The invention of the internet at the end of the 20th century and the use of it as a business tool has changed the way some of the population works. (In their pajamas) This has also changed where you have to physically be to enjoy your lifestyle.

The market players for the move back to downtown Houston has been young singles or young couples and empty nesters. Not having a need for schools for children and having work and recreation nearby, is a plus for them.

The housing consists of loft condominiums which have been built within older office buildings and warehouses which were too costly to return to original use. There is one full service condominium with another under construction with a completion date of 2006.

The beginnings of the Metro rail system to downtown will become more of a factor as the price for housing a car in the inner city becomes more costly and the rail is able to take you more places. Placing the rail through the Texas Medical Center and redeveloping the Mid-town area, however, was the wisest move made and a very controversial endeavor.

The downtown Houston nightlife is well established with the theater district, restaurants which cater to ‘after 6’ activities, and Minute Maid Park, the home of the Houston Astros.

Park space, which has always been at a premium in Houston, is somewhat addressed off the downtown area but not well within walking distance.

Overall, the move of the city to an interurban community is on the right tract. The future will tell how long and how powerful the attraction will be.

Thomas M. Ponce
I am Houston Real Esate Appraiser for The Ponce Group, a Houston Appraisal company.

A word on the AVM.

AVMs or Automated Value Models have been popular in the lending world over the past few years and the internet has many a service which states that it can render a value for a property. These services can be very helpful to those who need to survey data on neighborhoods for ranges of value and users statistical requirements.

However, let the consumer beware; AVMs are not appraisals. Those who compile them are not following proper appraisal adjusments and procedures and in no way do they subscribe to the rules or guidelines for appraising as laid out by federal law or mortgage associations. Because of this, they are held to no scrutiny for quality of their data or their work. These compliers never went inside your home; didn’t measure it, nor saw your new carpet and new paint or the lack thereof.

So remember, AVMs are only as good as you can throw them…and at my age, that isn't very far.

Thomas M. Ponce
I am Houston Real Esate Appraiser for The Ponce Group, a Houston Appraisal company.

Appraisers are surveyors of the market place; constantly looking at the actions of buyers and sellers and reporting what we see to those who need the information. In the broadest sense, all who utilize real estate are appraisers; however, the professional difference is we perform our analysis of the market as disinterested third parties. We have no desire for the property to be appraised. Our concern is for the property to be appraised according to federal laws, ethical balance, and meeting the need of our client.

For the most part, appraisals are needed by lenders who are willing to loan money for real estate purposes. The appraisal tells the lender what the property is worth as of a specific date so that the lender can make an informed decision relative to risk.

I was very fortunate to be trained by the staff of Charles L. Osenbaugh in the late 1970’s.

Mr. Osenbaugh was very strict as to how we reflected on the profession. He reminded us that people were the kings and queens of their castles and that for most people; the purchase of a dwelling was the most expensive endeavor in their lives. Consequently, you had to leave the buyer and the seller with the knowledge that you knew what you were doing and that they were making good decisions.

A lot of financial water has gone under the bridge over the last 30 years. The fads and foibles of the market place are of little use to me these days. My concern is the public trust. We have to be true to the actors in the market and true to ourselves.

P.S. If you've ever wondered, what's my home worth? Feel free to give us a call.

Thomas M. Ponce
I am Houston Real Esate Appraiser for The Ponce Group, a Houston Appraisal company.