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How to Appeal Your Tax Assessment

by Connie Yoshimura

Those ‘pesky’ green cards are out to MOA  property and business owners. By city ordinance, the cards must be mailed by January 15th each year and owners have thirty days from the mailing date to file an appeal. In order to do so, you must complete a written appeal form identifying the grounds for the appeal and pay a filing deposit. This deposit varies based upon the assessed value. For properties between $100,000 and $499,999 which includes the majority of single family homes in the MOA, the filing fee is $100. Between $500,000 and $1,999,999 the fee is $200 and above $2 million, the fee is $1,000. These fees will be returned to you if the disputed assessed value is resolved prior to the hearing. 

So before you file a formal appeal I suggest you take a hike down to the city assessor’s office located at City Hall, 632 West 5th Avenue, Room 300. Their office hours are 8 am to 5 pm, Monday through Friday, excluding holidays. The staff at the assessor’s office is both reasonable and friendly and if you can provide evidence that a mistake has been made, they can make an adjustment on the spot. In my experience, it is one of the most professional, knowledgeable and cooperative departments within the city.   

But before you get all bent out of shape about your assessment, here’s what you should know as to how they evaluate property. By statute, the assessor’s office must physically inspect property every six years. Just like you when objecting to your valuation, they take into consideration recent sales prices of comparable properties and, if you have bought the property, the sales price. Interestingly enough, Alaska is a non-disclosure state when it comes to sales prices and so property assessors are often sleuths when it comes to finding out values, even picking up marketing flyers or searching public records for mortgage amounts and types. 

If you are appealing a land assessment, you and the MOA should take into consideration location, zoning, desirable features such as view, waterfront, good access and even undesirable features such as poor soils or steep topography, location of utilities and the inevitable wetlands that impacts so much of Anchorage’s remaining raw acreage. 

If you are unable to resolve your assessment ‘at the counter’, you may file the appeal to the Board of Equalization which is made up of private citizens appointed by the Anchorage assembly. Like many boards and commissions, there is no compensation for their service.   

 

The average time on the market in 2016 for the 2,950+ homes that sold through MLS was 51 days. As you might expect, homes priced over a million dollar took longer to sell—an average of 92 days—while the shortest time on the market was 36 days for homes between $225,000 – $250,000.  But, even within those categories some homes sell within hours while others may languish on the market for months.  Unsold homes but still active on the market have an average time of 119 days, more than twice the time for solds. So what makes a home sell in a matter of hours rather than months? Obviously, price is a determining factor. Most professional Realtors give sellers a price ‘range’. Realtors intuitively want to get the best possible price for a seller and so most recommend the top of the market which may ultimately not be in the seller’s best interests. In today’s market, my recommendation is to price in the bottom third of the range and when considering price look only at other active on the market comps. After all, that’s how buyers are going to view the market, not what sold and closed six months prior.

Price, however, is not always the primary motivator for a sale. Unique properties fall into a special category. Homes with unobstructed views of either mountain or inlet views, a four car garage, a particular school district, the ability to walk to work, being close to family and friends, a larger than average backyard at the end of a cul-de-sac are all factors that help create a fast sale. These special features that make a home unique also command a higher value. Buyers are willing, even in today’s market, to pay more for what they really desire. I use the verb ‘desire’ deliberately because these special features are not necessities. Once a buyer finds their desired feature the home is sold.

It goes almost without saying that a home built in the 1980’s or even the 1990’s needs a ‘do over’ in order to be competitive in the market. And if that’s not financially possible at least a professional cleaning and de-cluttering. The magic for any ‘do-over’ is keep it neutral with clean lines. In Alaska, gray is fading fast as the preferred wall color. It just doesn’t lend itself to six months of fading light.

And then there’s marketing. Professional photos are a must. I know my new iPhone 7 has a better camera and can even make movies and videos but there are better cameras and more experienced photographers than most of us are and Realtors should be using them. After all, those photos get syndicated to the online world and a buyer’s first look is where acceptance or rejection occurs. And it’s hard to change that first impression, right or wrong.

Test Your Real Estate Knowledge

by Connie Yoshimura

Welcome to 2017!  There’s lots of opinions about the local housing market but facts are always better than opinions.  Take this quiz and learn the facts.

1. What was the average MLS sales price of a single family home in 2016?

A.  $260,000

B.  $306,000

C.  $366,000

D.  $406,000

 

2. Was this more or less than in 2015?

A.  More    B.  Less   C. about the same

 

3. How many single family homes were available in MLS the first week of January 2017?

A.  418      B.  518     C. 618        D.  718

 

4. Average residential sale in the last half of 2016 had what percent discount from the original list price?

A.  1%      B. 2%    C.  4%     D.  5%

 

5. What was the average price of an Anchorage condo in 2016?

A.  $175,000   B.  $203,000   C.  $213,000    D.  $245,000

 

6. Was this more or less than in 2015?

A.  More    B.  Less   C.  About the same

 

7. As reported in MLS, how many homes sold in 2016?

A.  950      B.   2,250       C.   2,800     D.  3,200

 

8. How does this number compare to 2015?

A.  Dramatically more    B.  Considerably less    C.  About the same

 

9. How many new construction homes were built in 2016?

A. 200     B.  300      C. 400      D. 650

 

10. What subdivision had the most single family building permits?

A. Resolution Pointe     B.  Huffman Timbers       C. The Terraces       D. Potter Highlands

 

11. The recent interest rate increase on a $400,000 to 4.25% increases the monthly payment by how much?

A.  $60       B.  $120    C.  $160        D.  $185

 

12. Approximately how much more does an applicant need to earn per month in order to qualify at the higher rate?

A. $200    B.  $400    C. $600    D. $750

 

13. How does the inventory of homes in 2016 compare to the inventory of 2008 real estate recession?

A.  15% more inventory    B.  15% less inventory     C.  About the same

 

14. How do the number of sales compare in2016 vs. 2008?

A. About the same    B. 17% more       C. 17% less

 

15. Based upon the information above what is your opinion on the 2017 residential real estate market?

A. Stable     D.  Slight decline of 2-3%          C.  Increase 5%

 

Answer Key:

1. C  2. C  3. A  4. D  5. C  6. C  7. C  8. C  9. A  10. A  11. C  12. C  13. B  14. B  15. A


The Past Is Not Always the Future in Home Sales

by Connie Yoshimura

A fourth quarter surge in activity brought 2016 within field goal range of 2015 home sales. Yearend sales for Anchorage came in just shy of 3,000, down only 58 sales from 2015. The late fall mortgage rate jump up to 4.325% for a 30-year fixed loan jolted both buyers and sellers into making buying and selling decisions even though the rate increase had been long expected. The year ended down only 2% in sales volume and, according to MLS, sale prices on average held at $366,000 for a single family home. 

But the big question is what will 2017 look like with almost daily headlines of job losses? Are we headed for a real estate recession like 2008?  The answer is not hardly and the reason is lack of inventory. Take a look at the chart comparing inventory and sales in 2016 to 2008, the year we saw the real estate recession hit. In 2016 Anchorage had 15.67 % less inventory than it had in 2008 while at the same time, we had 17.69% more sales. Even during the last recession between 2008 and 2011, Anchorage home prices fell only an average of 1.85%. Since then, they have increased 13.28%. Even with a decline of 2-3% in sales in 2017 and a similar modest increase in resale properties, we’re nowhere near the real estate recession numbers of 2008. Although I have bemoaned the lack of new home inventory over the past four years due to local over-regulation, it has successfully kept inventory low. Real Estate bubbles are generated in most part by over-building which hasn’t happened in several building cycles in Anchorage. 

My advice to both buyers and sellers is to take action the first quarter of 2017. Anticipated statewide job losses and how the newly elected President’s decisions affect the national economy will make for some uncertainty the remainder of the year. However, what will keep at least Anchorage’s home market stable is continued lack of inventory, despite any surprises that come our way—either positive or negative.

Some Predictions for the 2017 Housing Market

by Connie Yoshimura

Predicting the future is always a risky task for columnists and this year, in particular, is fraught with uncertainty, from the state’s economic stalemate and how the potential actions of President Trump may impact inflation and interest rates. Nevertheless, here’s an attempt at local predictions but don’t hold me to them. New home inventory will remain at historic lows whether its single family, duplex or multi-family. There simply isn’t enough housing to meet our population’s needs. Last week, after pending sales, there were only 418 for sale single family homes scattered throughout Anchorage. And most of them, due to their age, have functional and cosmetic obsolescence which will continue to be good news for local remodelers and Home Depots.

I predict interest rates will rise to 5% by the end of 2017, making all home purchases more expensive on a monthly basis and requiring higher income to qualify. This rate hike will have little impact on the upper end of the market where buyers pay cash or exchange stock equity for home equity but it will impact buyers purchasing $500,000 or below valued homes. Homes priced between $300,000 to $500,000 will continue to be the strongest sales but increased inventory will make competitive pricing a reality.

Not only will the interest cost of home ownership increase but so will the cost of utilities. Look for continued rate increases for water/sewer/gas and electric. So turn out your lights and lower your thermostat when no one’s home.   

Trending now in new home plans is the double master suite for multi-generational families. These home plans have first floor masters with connecting baths for the grandparents. Anchorage has one of the fastest growing aging boomer population in the U.S. and so that home plan will continue to be popular. So, too, will ranch homes. And surprisingly, they’re not just for boomers. Stairwells are expensive to build and take up valuable floor space. Remember those three-bedroom ranch homes of the 1960’s? They’re back with a craftsman style exterior and five-star energy efficiency. 

So here is the bottom line: higher interest rates with a little more inventory due to projected job losses but overall a relatively stable market with neither appreciation or depreciation. Sellers should price competitively to active inventory and not look at past sales, and buyers beware of the risk and costs of aging homes and get a home inspection. More predictions next week after all the stats are in.

Displaying blog entries 1-5 of 5

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Dwell Realty
561 E. 36th Ave., Suite 200
Anchorage AK 99503
907-646-3600