Thursday, April 8, 2010

Tough Pill to Swallow--Tax Valuations Arrive in Anoka County

It’s that time again…Your 2010 Notice of Valuation for property in Anoka County should be arriving in your mailbox any day now!

Ours arrived just last week and the numbers, surprisingly, did reflect the recent real estate market! I had mixed feelings about the drop in value, happy I didn’t have to argue with the assessor that our home was being overvalued but disappointed in the reality of how foreclosures have affected of all Anoka County homes. As a real estate agent, I know that the sales price of homes has decreased significantly in some areas of Anoka County during the past few years. The decrease in value has been so noticeable that when I received my 2009 Notice of Valuation, I doubted I could sell our home for the value set by the county.

I have spoken with the Anoka County assessor’s office on a few occasions. They are very nice and explained that they previous year's data and setting the value for the next year. So this 2010 statement contains a valuation based on 2009 values which will be used to assess taxes in 2011. The assessor’s office attempts to stay on top of the real estate market and goes out to review area properties on a regular basis. This process goes year round but starts in the spring and summer. The office diligently watches the property sales amounts with a goal to be within a few percent of the actual market value at that specific period of time. But remember, by the time everything is processed and mailed to tax payers, the information for 2011, which we receive in the spring of 2010, is now 6 months old. I can only imagine that with this fluctuating and changed market, how difficult assessing property values can be.

It can be a challenge to explain the difference between the county’s property valuation and what I determine to be the optimal list price to the average home owner request a comparative market analysis (CMA). Of the most recent CMA’s I have completed, home owners still have a bit of a reality check. Today a homeowner considering a traditional sale (not a lender mediated short sale) has to spend money to put their home in exceptional condition and then price the home competitively. That is, price the home to compete with the prices of bank-owned and short sale homes. With decreasing property values this can be a tough pill to swallow for many sellers.

As an Anoka County home owner, I am not concerned by the 10+% reduction in value of my home by Anoka County. Since my valuation directly affects what my property taxes will be, a lower value should equate to somewhat lower taxes. As a REALTOR® I know sellers see things a bit differently. They want to look at the maximum value or an old appraisal for the worth of their home: their asset: their investment. Unfortunately, buyers and appraisers look at the current value in the market today. And though the numbers of homes sold has picked up a bit in the early part of 2010, current SOLD prices sold are still down 15-30% from the values of a few years ago. Homeowners wanting to sell their home this year must list at a price more in line with the tax valuation just received than with what it appraised for or was valued at years ago.

Copyright 2010 Teri Eckholm