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investment Money Island sustainability

Unstable property values bring stress and new opportunities

Our local property values at the bayshore peaked in 2006 and took a big dive since then. (The chart produced by Zillow below doesn’t even show the largest declines before 2011). I’ve worked on a few projects for investors over the years and each is shocked to see the data.

Taking all the available long term data as a whole, it is clear that each event we’ve lived through: the financial crisis, changing government procedures, Sandy and buyouts have all had a clearly identifiable impact on property values here. The more recent sale data swings are interesting and not so easily explained.

The scariest part now is that over 40% of homes have negative equity (compared to 8% nationally), and that’s only on bank loan balances, not unrecorded environmental compliance liabilities that are HUGE in many waterfront properties.

Yet the many challenges bring just as many opportunities. I’ve found that some people are eager to tackle it and others just don’t want to talk about it and prefer to just deny what’s going on. But the smarter investors extrapolate the data to forecast other impact.

By tonynovak

founder and current controller of Baysave

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