In all my years of property ownership, I have never seen a market like this one. Recently, Robin and Company (a CNN Broadcast) had a new report on the housing market. They mentioned that in February sales slumped 0.3%. Robin and Company also mentioned that the average median home sale value dropped to $217,000. The biggest point they mentioned was that whole house values slump tax assessed values are on the rise.
Personal Housing Prices Slump while Property Taxes Rise Impact
With my property, I’ve always used the real property search in MD to get a gage of my home’s value. In the past, the real property taxes’ assess value was about half of the real value. We would pay taxes on that small amount. We could get the property appraised and get access to the larger amount. Now that gap has narrowed significantly. I’ve seen the gap go from a few hundred thousand to 1/3 of that.
I recently had an appraisal of one property in January. I really haven’t doing anything new to it. I simply maintained the property. We do upkeep and make certain anything that needs to be addresses in addresses. We have a staff that can handle any and all issues. Roughly 4 months later, I get another appraisal. The homes value dropped 40,000 dollar. I was nearly chocked at the change. The appraiser told me that the values were simply not there right now. He continued to let me know that we all took a hit in the winter. He expected that the value would catch back up this summer.
Client’s Housing Prices Slump while Property Taxes Rise
I worked on a clients home and improved the value significantly. We gave her property an update kitchen, bathroom, and garage. She will have a tremendous increase in her value. She didn’t want to get a new appraisal from her bank. What was her reason. She didn’t want to have the property accessed rise. She didn’t want to pay more in taxes. He current tax assessed value was $420,000. The houses appraised value was only $400,000. In other words the goverment litteraly is charging her more money in taxes than her home is really worth.
I’m working with this client to fight the tax accessed value. However, I wonder how many other have this exact same issue.
Buyers Market as Housing Prices Slump while Property Taxes on Rise
I have another client that was going to purchase a house in baltimore. We went through a few chalenges to get the deal done. At the end of the day. The seller and their agent was unfreindly and not willing to work with the buyer. We ultimatley let the seller walk. There are so many additional homes on the market, we have no need to fight for one with and unfriendly seller.
As a buyer, this market is the best of bother worlds. If you choose to buy and older home, sellers will most likely want to work with you. If you choose to buy a newer home, the builders have insentives to give you a sweatheart deal. I know two investors that bought investment properties in my area with 10,000 down. They got $80,000 in builder incentives. Niether person put up another dime. The moved out of there older home and rented it out to new tenant.
All that said, this is a tough market. It can work to your advantage. You might fight to make it happen. Best of luck in your Real Estate chalenges.