Realty.com

White House Loses Value – Again

Posted January 14, 2010 by Matthew Denton

But how valid is its value?...  And who said your house was the only one with a problem?

CNN reports that the White House shares the same plight with most homes in the country today based on a real estate website’s independent survey. The report states, “In the past year, the estimated value of the 132-room mansion on 1600 Pennsylvania Avenue dropped 5.1 percent—from $308 million to $292.5 million, according to the real estate Web site Zillow… A year earlier, the White House lost even more of its estimated value—almost $24 million, a 7.2 percent drop. During the same period, home values in the United States plummeted 11.9 percent on average.”

But many comments in the major websites that carried the news are challenging the credibility of the survey. Some have wondered why such appraisal has to have validity when in fact the white house isn’t for sale at all. Well, you could always have your house appraised even when you’re not selling it. Even the White House can have its value determined.

Second, many bloggers are wondering why a comparable sales method was used to determine the President’s home value. This baffles us is the way it was appraised. Zillow however states, “Zillow’s statisticians deemed the White House the most historic home in America and applied a maximum historical premium to their models to determine a Zestimate value today of $308,058,000.”

In other words, Zillow identified the comps that were the most expensive homes in the country plus other historic homes for sale. The historic premium then was calculated over similar homes with no significance. This may be too complicated for non-statisticians like us but with the way things are questioned over by interested readers, they have a point for raising such clarifications. In fact, surveys must be accompanied with detailed explanations on data gathering and analysis – one that can fit in the comprehension of majority.

Going back to the findings, it seems that this news won’t bring much worry to the President. First of all, it’s not his own house. Second, the policies that the Treasury Department institutes are yet to take a long-term effect. Finally, the White House stays as it is no matter what its value is. Once its price nose-dives, you won’t expect the President to be rushing to the bank to take out a mortgage.

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