| Author |
Message |
    
Townie
| | Posted on Wednesday, February 14, 2001 - 8:28 am: |     |
Joancrystal,
If the hypothetical house owned by the hypothetical Senior couple can't sell their house for anywhere close to what it was appraised for, they have an incorrect assessment and should appeal it. |
Teach66
| | Posted on Wednesday, February 14, 2001 - 11:50 am: | |
I believe that some of life's "set back" are some of the best things that could happen to us. Just think, the couple that has to move to an apartment just might realize that now they have more time for each other and can stop spending endless hours at work just trying to pay for their house, the senior can unload their home and possibly end up in senior housing or assisted living which would relieve them of the stress of maintaining a large, older home and if people end up really feeling "hit" by this reassessment and the town ends up divided (as it sure looks like it will be) we may even end up with a new TC! There is always a bright side to every negative situation. |
Mtierney
| | Posted on Wednesday, February 14, 2001 - 11:59 am: | |
Since the reval placed on "that hpothetical senior couple" was based on the astronomical sales figures of 2000 that couple has a problem! Why should this burden be foisted on this couple? They weren't planning to go anywhere, just hoped to be able to continue to live in their homes. Even while paying extremely high taxes (mine were $11.5G and will go up to at least $16G. We know the reval was (God forgive me) FLAWED. In my view Senior spells anyone who is retired whether by choice or by downsizing. All the seniors on SS who are still working to survive will just have to work harder I guess! |
Melidere
| | Posted on Wednesday, February 14, 2001 - 12:24 pm: | |
Mtierney,
I know this is hopeless...but if everyone is valued by the same standard, and the reval is a method of DISTRIBUTION amongst the various homes in the town...exactly how does it matter whether or not you do it at the top or the bottom of the market?
Can you show me the harm?
I know there is a theoretical way to produce a harm under the two scenarios, but in our case..the percentage increase in 2000 in our lowest-priced homes would belie the premise that there is any harm done at all. |
Mtierney
| | Posted on Wednesday, February 14, 2001 - 4:30 pm: | |
The last I heard is that you are taxed on each and every $100 of evaluation. If today someone says your house is worth $500,000 more than it was yesterday, your taxes are going up up up. That's how it matters. |
Mtierney
| | Posted on Wednesday, February 14, 2001 - 4:34 pm: | |
The last I heard is that you are taxed on each and every $100 of evaluation. If today someone says your house is worth $500,000 more than it was yesterday, your taxes are going up up up. That's how it matters. |
Mtierney
| | Posted on Wednesday, February 14, 2001 - 4:35 pm: | |
Sorry about that. |
Damellon
| | Posted on Wednesday, February 14, 2001 - 5:34 pm: | |
Wow, I like "teach"'s outlook (above). Let's all look on the bright side!!! |
Melidere
| | Posted on Wednesday, February 14, 2001 - 5:36 pm: | |
But that isn't how it works, mtierney. Not in the reval.
Let's say total tax is 1000 and your house is worth 100,000 and mine is worth 100,000.
you and i each pay 500.
Let's say total tax is 1000 and your house is worth 500,000 and mine is worth 500,000. We each still pay 500.
The bubble isn't the issue. The RELATIVE values are the issue.
As long as everyone is measured by the same bubble..the 'bubble effect' is relatively minor. |
Octofoil
| | Posted on Thursday, February 15, 2001 - 12:03 am: | |
Melidere,
Well, actually, its the change in the relative values from one measurement to the next, isn't it? And if you look at the sales data provided by Jerry Ryan, you find that there was quite a change in the distribution of sales over the last three years. In 2000, the distribution of prices was much more skewed toward the higher end, resulting in a sharp divergence between the arithmetic mean sales price ($283,000), the median sales price ($260,000), the modal sales price ($160,000) and a kurtosis value of better than 1.98. (Recall our discussion about averages? Here's another example of how misleading it can be to rely on the "average"!)
What does this mean in practical terms? We don't really know, because we don't know CV's methodology. We have had to rely mostly on our own "gut feel" as to whether the numbers are reasonable or not. Consequently, many feel ok about it all, but many have grave reservations.
The point is that the old saying about a rising tide lifting all the boats may not apply here. Galante has said that one, they mainly used the sales figures for 2000, and two, in general, they come up with a number and then make the details fit. If that number that they came up with was based in any way, shape, form or fashion, on the arithmetic mean of the 2000 sales data, the results may be biased. |
Melidere
| | Posted on Thursday, February 15, 2001 - 8:01 am: | |
They may be, and since you are the statistician (no snideness intended..even though there are several terms in your post i'm clueless to understand)i'd love it if you would work it all out for us, but here is an example of what i mean.
A house (*everyone can look up which ones if they like) on prospect sold in july of 98 for 295 and was assessed for 541(assessed in 81 at 106). A house on hilton sold for 100,000 in jan of 99 and was assessed at 188,000(assessed in 81 for 67). Both of those homes are assessed upwards(from the end of 98/jan99) about 88%.
Houses on hilton sold for between 100 and 125 in almost every data point since 1990. Another house on prospect valued at 490 sold in 1990 for 261.
In order to keep the 'relationship' between the two houses the same from 1981 to 1998, the house on prospect would have to sell for 156. Wouldn't a simplistic way to look at the 'bias' on prospect be to ask when was the last time you felt your house was worth only 156?
The houses on hilton were originally assessed at about 65% of the value of the houses on prospect. By 1990, they were worth roughly 35% of the houses on prospect (the houses on prospect currently valued at the 475-525 level). in 2000 the houses on hilton were assess at about 35% of the houses on prospect.
The numbers have changed in the last couple of years dramatically...but the relative values (based on this example) have not.
Almost every sale on elmwood for a decade was under 200, and then in AUGUST of 2000 FOUR houses sold for over 335.
You are obviously the statistician, but what are these examples suggesting to you? The 'bubble' pulled up the lowest end houses right at the very, very end of this process.
Yea, there is a 'bubble' effect. Going back two years would INCREASE the skew, not decrease it.
The fundamental relationships...ie a house on hilton was worth rought 65% of one on prospect...changed back in the late 80's. The 'catching' up (even partially)...didn't take place until close to august of 2000.
Everyone's instincts are right. Bubbles start with the higher end houses and take some time to filter down to 'lifting all boats'. In our case...the lifting of the lower end boats didn't come till the summer of 2000.
The end of the bubble is what kept the higher end houses from having even LARGER increases. |
Njjoseph
| | Posted on Thursday, February 15, 2001 - 10:29 am: | |
Melidere, there's a lot more than meets the eye. I own one of the August, 2000 houses on Elmwood that you mentioned. The price I paid was not a bubble nor a spike. It is totally in line with the $200K+ prices on the rest of the street. What you don't see on the spreadsheet is that I have the largest house on the street (all-brick, extremely well-maintained), and over half an acre of property. There is one other house on the street that is of comparable size with comparable property, just a few doors down from me. The rest of the homes are significantly (!) smaller. The only exception is the B&B, but I'm not counting it because it's not a class 2 property.
It's nice to see the numbers on the spreadsheet, but you really can't come to all the conclusions you came to. You know nothing about square footage of the house or the property.
It will be interesting to see if your analysis about the bubble will prove to be true, but I just want to caution that the spreadsheet is not the be-all and end-all in the tax debate. |
Octofoil
| | Posted on Thursday, February 15, 2001 - 10:35 am: | |
Melidere,
I'd like to do some more work in this area, but I only have the data on sales in 1998, 1999, and 2000 that Jerry Ryan posted. You seem to have actual sales data going back considerably further.
Can you point me to that? Is that a source that I can access?
Interesting stuff. Thanks for being involved and responsive... |
Melidere
| | Posted on Thursday, February 15, 2001 - 10:51 am: | |
octofoil,
jerry posted the whole database for us..and i thought it was at ryanfamily.org...but it seems to be elsewhere on his site.
if you do a keyword search you should find it fairly easily.
unfortunately, there isn't much in the way of sales data before 1990. |
Melidere
| | Posted on Thursday, February 15, 2001 - 11:03 am: | |
njjoseph,
i don't want to make you feel bad about your purchase (i'm REALLY GLAD to have such an intelligent, open-minded guy for a new neighbor..and welcome, btw)
but we decided not to buy a terrific house on midland a few years ago because by the time you put in all the work it needed...it would have a cost of over 300,000.
the rule of thumb at the time..(not long ago) is that you would be way too far over the value of the surrounding area to ever get that for a house.
I'm sure your house is terrific and on huge acreage. The houses on your side of the street on elmwood are fabulous, with wonderful views and large lots. But 358 (which i haven't looked...but is close and on the same side of the street..sold in jan 98 for 190 and is now being assessed at 282.
your purchase was just as out-of-line for our area as some of the 'bubble' prices people are talking about on the west side. |
Njjoseph
| | Posted on Thursday, February 15, 2001 - 11:25 am: | |
Melidere -- Thanks for the welcome!
358 Elmwood is not one of the properties with huge lots, and it is a much smaller house. Look at 370 to 384 and you'll see those that have the large lots, although square footage of mine compares only to 370. The rest are much smaller.
I have a 3200 sq. ft. house. There is NOTHING out of line with my high-$300K price. I also looked at 22 Norfolk (roughly the same size) which sold at $394K, but had no property in the back. These houses are HUGE compared to the rest in the area. In fact, I almost wondered if I "stole" the house when I bought it. Much smaller houses on Madison, Plymouth, Courter, Burroughs Way, etc. were $329K to $429 last May. I couldn't justify paying those prices and having to renovate kitchens, etc. My house needs no renovation, however a new coat of paint is in order. And that's it. A perfect house at a good price. That's the only anomaly.
You can't make me feel bad about my purchase. The much smaller house next door to me is rumored to have sold at asking price ($379) and 370 is up for $429K (I don't know if it went to contract yet). 370 NEEDS a new kitchen -- the stove and dishwasher are 50 years old, or at least look it. The cabinets and living space are non-descript. The front hallway needs help. However, it's a great house, and some buyer will be very happy there once the few renovations are done. And BTW, it's technically only a 3-bedroom house, although there's a 4th (guest room) in the basement.
I invite you to stop by sometime, Melidere, to see my house. I think you would agree that I didn't overpay. |
Melidere
| | Posted on Thursday, February 15, 2001 - 11:41 am: | |
i don't mean to suggest you overpaid relative to the market as it is now...and in line for when you bought it.
however...the issue here is whether the 'bubble' has unfairly penalized the 'west' side..or 'prospect'.
basically...if you ask a lot of those people who are boggled by their 500,000 and 600,000 assessments if a house on elmwood (no matter how big it is) could sell for close to 400,000....they would look at you like you were nuts.
if you haven't been in the market in the last couple of years...this is all pretty mind-boggling news. |
Njjoseph
| | Posted on Thursday, February 15, 2001 - 11:56 am: | |
Of course they'd say I was nuts! They'd never seen my house. They don't travel to my end of town.
Which I really don't believe, because I think Elmwood is the major street bringing people to the pool on Boyden. It's a prominent house that can't be missed.
The people looking at my $400K house with their $500K or $600K houses looking at me like I was nuts -- why? Holier-than-thou attitudes? Elmwood is the wrong side of the tracks? I live in a racially and ethnically diverse neighborhood?
And this all confirms that the reval is not flawed! A 3200 sq. ft. house in my neighborhood can't go for $400K, but it can go for $650K on Wyoming. The westsiders are saying my house has less value than theirs? Real estate brokers, too? Well, I pay over $10K in taxes. Sounds like a comparable home on Wyoming should pay $16K - $20K. Which is what they are now being asked to do. They think they're numbers are too high, but they also think mine are, too? Let's lower 'em all, but you'll still pay more on the west side.
I'm rambling. |
Melidere
| | Posted on Thursday, February 15, 2001 - 12:00 pm: | |
i'm so sorry..you totally misread my post.
only nuts compared to the prices we are used to seeing.
location is always a major component of price.
no one is saying your house 'should' be less..i'm saying they don't realize how much the values have jumped here, also. |
Melidere
| | Posted on Thursday, February 15, 2001 - 12:01 pm: | |
the hollerinig you keep hearing is that they don't believe their houses ARE worth 500 to 600.
see what i mean?
they think THEIR houses are still worth 450.
(just making up round numbers here) |
Njjoseph
| | Posted on Thursday, February 15, 2001 - 12:09 pm: | |
O.K., Mel, I understand. (sorry it took me so long). It proves that most Maplewoodians that haven't bought their houses in the last 2 or 3 years are probably way out-of-touch with the reality of the housing market here. Which does not prove the revaluation is flawed.
Don't people go to open houses anymore? |
Melidere
| | Posted on Thursday, February 15, 2001 - 12:15 pm: | |
they do...but time flies. i haven't been to any in a couple of years. I'll admit i had no idea till all this reval info started coming in.
I have known for a good ten years that the tax imbalance was there. I used to go to a lot of open houses. that's why i'm so confident that the 'imbalance' isn't from the last couple of years.
but i had no idea that the prices had jumped like that. |
Lseltzer
| | Posted on Thursday, February 15, 2001 - 3:29 pm: | |
The database is at http://members.aol.com/revalinfo07040/cert-011901-3.xls
There is an error in the link on the ryanfamily.org page. |
Octofoil
| | Posted on Thursday, February 15, 2001 - 3:47 pm: | |
Lseltzer,
Got it! Thanks. |
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