Sacramento Area Property Tax Appeals: Reduce Property Taxes, Lower Property Taxes, Appeal Property Taxes » Market Trends

Declining property value, but increasing land value?

Sac Tax — Tue, 01 Mar 2011 05:43:29 +0000

This is a graph we put together that places all sales in a particular community in California against the Assessor’s land value for a specific property. This was part of a consulting assignement we completed for a home owner to help him in his appeals hearing with the Assessor to contest the base-year value of his property. The goal of this research was to display the overall trend for property value in a particular neighborhood through the Fall of 2008 (red line), while simultaneously viewing the Assessor’s land value (black squares). This one graph is not the end-all solution to convince the Assessor to lower assessed value for this property, but coupled with some other data and comparable properties, the graph serves its purpose well.

Do property value trends and land trends seem out of sync? Why did the Assessor persist to increase land value over time through 2008 despite an obvious turn downward in property value?

This is an example of some of the consulting work we do. At times we are hired by property owners or other parties to assist them in research that might include graphs or data, but not a value opinion. Honestly, we really like this type of work because it is interesting and very intricate.

Call me at 916.595.3735 if you have any questions or need research or consulting.

Sacramento home owner is taxed on twice the amount of his property value

Sac Tax — Fri, 19 Nov 2010 05:41:44 +0000

How would you like to pay taxes on twice the value of your property? I just finished a property tax appeal today for a Sacramento condominium owner. This condo was assessed at $166,000 by the Sacramento County Assessor’s Office, but the actual value was $84,500. Have a look below by comparing the blue dot ($166,000) with the rest of the black dots, which represent all sales in the neighborhood. Isn’t that wild? This condominium was assessed nearly two times actual market value, which amounts to about $1,000 too much in property taxes for the home owner to pay.

Condominium values have been hit hard in the past several years as the real estate bubble in Sacramento burst. Why? In addition to property values decreasing for condos just as value has declined for other types of property, crammed condo living and HOA fees have seemed less appealing for buyers who can now more readily afford a backyard of their own.

If you have any questions about property tax appeals, or would like to have my property tax consulting company look up your property for free, call 916.595.3735 or see www.SacramentoTaxAppeals.com.

What do you think of the property tax scenario above?

A Decade of Unemployment Rates in Sacramento County

Sac Tax — Tue, 17 Aug 2010 23:35:26 +0000

Put on your economist hat and let’s take a look at the past decade of unemployment rates in Sacramento County based on the month of June. What do you see? Is it any wonder why property values have decreased so much? If people are out of work, mortgages cannot be paid and higher prices cannot be afforded. Moreover, when there is a decline in property value, people should not be paying as high of taxes as they paid five years ago. Any thoughts?

June 2010     12.6%
June 2009     11.5%
June 2008     6.9%
June 2007     5.4%
June 2006     4.9%
June 2005     5.1%
June 2004     5.9%
June 2003     6.3%
June 2002     5.8%
June 2001     4.5%

A look at REOs & Short Sales: Is the Sacramento real estate market getting healthier?

Sac Tax — Wed, 26 May 2010 04:13:23 +0000

How is the Sacramento real estate market doing? Is it getting better or worse? Are there more bank-owned sales right now than in recent years? There are so many indicators for the health of a real estate market, but let’s take a look at the percentage of bank-owned foreclosure sales (REO) vs. short sales. What do you see? What stands out to you? Any good news here? What might this mean for property taxes in the coming year?

* Data is based on Sacramento MLS for all single family detached properties in Sacramento.

Market Trends for the “Anatolia” area of Rancho Cordova: What do you see?

Sac Tax — Wed, 05 May 2010 04:22:10 +0000

Here are a couple of trend graphs below for the 95742 zip code of Rancho Cordova. This area is comprised mostly of “Anatolia”, but also consists of a development called “Sunridge”, which is not part of the Anatolia HOA.

You be the appraiser here. What do you see in the trend graphs below when looking at the past years of sales? Is there anything you notice to be different or similar when comparing the two graphs? Do you think the Sacramento County Assessor has kept in touch with declining property values in the Anatolia neighborhood of Rancho Cordova? If you are a home owner, please speak on.

Past three years of sales:

Past one year of sales:

Graph of Sales in 95828 Zip Code of Sacramento

Sac Tax — Fri, 26 Mar 2010 03:24:24 +0000

I thought this might interest anyone living or considering purchasing in the 95828 zip code of Sacramento. What do you see? What stands out to you about this trend graph? All sales are based on information provided in Sacramento MLS (single family detached sales only).

Looking Back on a Sacramento Fourplex

Sac Tax — Wed, 17 Mar 2010 03:27:07 +0000

Looking at the sales history of a property can be very telling. In fact, you can often get clues into the happenings of the real estate market. Here is an interesting sales history for a Sacramento fourplex I came across in the course of a current assignment I’m working on. This is not at all atypical because the market for residential-income properties really boomed in Sacramento (and then it fell hard too).

7/25/2000 – $110,000 sale
7/16/2002 – $278,000 sale
8/18/2004 – $435,000 sale
2/10/2005 – $459,000 sale
9/08/2008 – $377,500 sale (maybe a short sale – did not list in MLS)
5/01/2009 – $104,250 (transfer to bank – foreclosure)
7/13/2009 – $140,000 sale

What do you see? Does anything stand out to you? Let me know if you have any questions about the local real estate market or your neighborhoood. With the decline of property values in the Sacramento Region, it makes it very important to keep make sure that the Assessor reconciles their assessed value to a consistent level of true market value (it’s not always the same – at all).

The Crashing of the Fourplex Market in Sacramento

Sac Tax — Mon, 16 Nov 2009 19:57:56 +0000

I wrote previously about the “Bursting of the Duplex Market in Sacramento“, so I figured I’d also provide a graph of the fourplex market so we can see visually what has taken place over the past three years in Sacramento County. Yes, I know Sacramento County is a large territory representing many neighborhoods and sub-markets, but I think this trend graph tells a story nonetheless. All blue dots below are sales based on data in Sacramento MLS.

Isn’t it amazing to see the impact of the housing bubble burst? Three years ago many quadruplex units in Sacramento County were selling between $400,000 to $600,000, but the bulk of sales lately have been easily hovering around $200,000 +/- or lower. With prices so low right now, many investors have understandably been purchasing 4-plex units. The ideal scenario would be to pick up a quadruplex, have postive cash flow, and then re-sell the property in a number of years when the market turns around.

I actually just finished a property tax appeal for an investor who purchased a fourplex in late 2009 for under $200,000, but the Assessor still had his property valued in the high $300,000s. He is scheduled to pay over $1,000 too much in property taxes this year because the Assessor’s records are not consistent with realistic trends in the marketplace. This is a common problem for so many properties that sold near the top of the market and are now re-selling in today’s market.

Let me know if you have any questions. Comments are welcome. Ryan 916-595-3735.

www.SacramentoTaxAppeals.com The Crashing of the Fourplex Market in SacramentoSacramentoTaxAppeals.com

The Up and Down Dynamic of Foreclosures and Short Sales in Sacramento County

Sac Tax — Sun, 15 Nov 2009 19:59:14 +0000

We hear so many voices in today’s real estate market talk about the foreclosure rate decreasing in the Sacramento Region. Is that true? Are there less REO (bank-owned) sales today than there were two or three years ago? Let’s look at some hard numbers below for Sacramento County.

The information above is based on all residential sales listed in Sacramento Metrolist over the past two years. Overall, it’s true that there were less bank-owned sales in Sacramento County during the last 12 months in comparison to the year before that. The foreclosure rate decreased by 5% overall, but the interesting thing is that short sales increased by 7% during this same time period. What do you make of that? Have short sales simply replaced what would have been a similar rate of foreclosure for this year? As a home owner or real estate agent, have you found banks to be more receptive to working with you to do a short sale? Comments welcome.

www.SacramentoTaxAppeals.com The Up and Down Dynamic of Foreclosures and Short Sales in Sacramento County

The Bursting of the Duplex Market in Sacramento

Sac Tax — Tue, 10 Nov 2009 19:53:42 +0000

Do you remember several years ago in the Sacramento area when duplexes were selling for $400,000-$500,000+ like it was nothing? Well, the housing bubble burst and the residential-income market came crashing down along with everything else.

The graph below displays all sales in Sacramento County for duplex properties. I know, Sacramento County is an enormous territory, but sometimes viewing large ares helps to see an overall trend.

What do you notice when looking at all duplex sales in Sacramento county? It seems the bulk of sales are well under $300,000, and that the median sales price level easily lost $200,000 or more over the past three years. Ouch. There certainly are an enormous portion of sales between $100,000 to $200,000 too, aren’t there?

Let’s take a closer look at a specific area in Sacramento by viewing sales in North Sacramento in the 95815 and 95838 zip codes. No, that’s not a ski slope, but a trend graph of all duplex sales.

It’s interesting to see what looks like two markets at hand above: One market below $100,000 and another market hovering between $150,000-$175,000. Market segmentation (bifurcation) is common depending on condition, location, size, or even the nature of the sale – short sale vs foreclosure vs typical arms-length transaction.

One more. What’s happened in the city of Rancho Cordova’s duplex market over the past thirty six months? No surprises. It looks similar to the graphs above.

When it comes to duplexes in Rancho Cordova and surrounding areas of Sacramento, the majority of recent sales are reo properties (bank-owned). For example, in a recent duplex appraisal I just completed in a Sacramento neighborhood, 84% of all duplex sales over the past 12 months within this neighborhood were REO sales and 10% of all sales were Short Sales. It’s not an easy market when 94% of all sales carry some level of distress.

Contact me at 916-595-3735 or info@SacramentoTaxAppeals.com if you have any questions.

www.SacramentoAppraisalBlog.com The Bursting of the Duplex Market in Sacramento