Wednesday, August 23, 2006

Have You Lowered Your Net Worth to Reflect a Lower Home Value?

Here's a great question, posed by Kansas Simplicity: how have you changed the value of your home in calculating your net worth? What tools are you using to determine the value? How much did you increase the value during the real estate boom? In recent months as the air has come out of the bubble, have you decreased it?

7 comments:

mapgirl said...

Good question! I adjusted my net worth lower a few months ago. I got very uncomfortable with the comparable asking prices for units in my area. I got my real estate assessment and actually adjusted downwards from there.

Luckily, I'm still in positive territory, even though I'm playing it conservatively. :-)

ObsessedWithMoney said...

Great blog! Hey, can you post a link to my blog, it just started and I'm trying to generate a following. thanks.

www.obsessedwithmoney.blogspot.com

Imin Dennialle said...

I haven't adjusted my house price down because I know things will turn around soon. I'm gonna hold my house another three years and am including in my current net worth an average appreciation of 10% each year for the next three years. I may change my calculation to 20% appreciation per year for the next five years because I'm thinking about getting a new boat and maybe retiring early.

wendy said...

First of all, I don't have a blog where I post my networth. But, in our personal networth calculation, we don't include our primary residence in our networth at all. Since we don't live in a particularly expensive area of the country and we will always have to live somewhere, we didn't think including the value of our home was appropriate.

2million said...

Great question. For both of my properties I list their value at the price I purchased them at, which was below the appraisal price and well below what the current value may be. I like to stay on the conversative side when tying to compute my net worth.

The Travelin' Man said...

I do not post my net worth on my blog, but for computational purposes on my own, I never used the highest valuation of comparable homes in the area, and I did some improvements (tile, for instance) that would increase the value over comparable units. So, I have not (yet) adjusted downward, but I still see that homes in my area are selling for far more than what I value my own property. Also, I did not really add ANY value to my net worth until the property was worth well more than what I owed. My equity is now easily triple (maybe quadruple) what I owe, so I feel confident that if I ever HAD to turn my condo into cash, I would get that cash!

finance girl said...

That's funny, I blogged today about homes too. I value my rental property at what the county values it for tax year and I value primary residence waaaay low more at a cost basis. I like to stay conservative with the primary residence but the rental house is in a white hot area that will continue to be white hot (but I won't increase the value i estimate it at, it'll just stay as is)