Market Value affect of purchasing below market value

[Greg B.]

I have a question about multi families being purchased within the same area and its affect on overall market value.

If I purchase a multi for $60k with a market value of $100k, another investor purchases a property a block over for &70k with a market value of $100k and this happens a few more times over the course of a year. If I decide to refinance my property would it be safe to say that the market value, according to comparable sales, is no longer $100k but somewhere in the 60s or 70s?

Our goal as investors is to purchase below market value for built in equity and to cashflow properly but can that have an effect the values of properties over time? All things being equal

Thanks

ps - excuse me if I'm using the wrong effect/affect lol

[Thomas S.]

If a property is purchased at 70K then it's market values is 70K until it is upgraded and assessed at a higher value. If a seller leaves money on the table a assessment should reflect that fact. Unless a investor is operating in a extremely small market investors making under market deals should not effect the market and will be corrected upon reassessment.

"all things being equal" 70K properties are worth 70K until assessed otherwise.