Falling home values are disheartening, but seller must accept

Q. Our home was just appraised, and the results were disappointing. The assessed value was $100,000 lower than our previous appraisal one year ago. This totally shocked us, given the recent improvements in the economy and the housing market. What are our options for handling this lower than expected appraisal?A. This column typically addresses property defect and disclosure issues, rather than property values. But the conditions that affect appraisal values are apparent to nearly everyone who participates in real estate transactions on a daily basis, including agents, home inspectors, pest control operators, and others. So here is one home inspector's opinion.Home sales have noticeably increased in the past year. But this is largely due to lower prices, not to an invigorated economy. The over-inflated prices of previous years have fallen to levels that people can now afford, and interest rates, temporarily suppressed by the government, add to this affordability. For many sellers, it is hard to accept that prices are no longer what they were and are unlikely to recover in the foreseeable future. Some economists are predicting new waves of foreclosures in the coming year, leading to further price reductions.Interest rates are expected to rise because current low rates discourage foreign countries from financing America's rising debts. And higher taxes, set to occur on January 1, could leave less money available for mortgage lending.The rear view mirror is not where you should look for direction in today's real estate market. The prices of the past are just that - prices of the past. Your current appraisal value may be disappointing compared with last year's, but it may be better then next year's appraisal.Fortunately, there is one silver lining in this cloud: Although you must sell your property for less, you will also pay less for the next one you buy. Whatever fortunes or misfortunes the future may hold, that is the only direction we should be facing.Q. We built an addition onto our master bedroom about four years ago. Since then, a crack has appeared in the ceiling where the new drywall meets the old. The work was done by a licensed contractor, but we're wondering if he did a very good job. We've tried calling him and have left messages, but he never calls us back. Do we have any recourse?A. The crack may or may not indicate a significant problem. It could be due to faulty construction or simply to shrinkage of the newer lumber. However, the remodeler's refusal to return your calls throws a bad light on what might otherwise be a simple problem. If the builder will not respond, you should file a complaint with the state agency that licenses contractors. You can also hire a home inspector to evaluate the entire addition. If corrective work is needed, and the remodeler won't address the problems, you can take him to small claims court. But be sure to get some legal advice before pursuing that course of action.bull; E-mail questions to Barry Stone through his Web site, housedetective.com, or write AMG, 1776 Jami Lee Court, Suite 218, San Luis Obispo, CA 94301.Access Media Group