By Jim Sack
Wow.
The Wall Street Journal lists us, Fort Wayne, as one of the top gainers in the nation when it comes to home price increases. A 9.2 percent jump. Just a bit less than LA at 9.3 percent and a bit more than Honolulu at 9.1. South Bend also made the list with an 8.9 percent jump. Akron was tops, despite the loss of LeBron, at 36 percent.
Well, being a landlord, owning twenty properties, that gives me mixed feelings. First, it is nice to see my beloved city shown in a win column for almost anything. There are people in Maui reading this article this morning as the breakers roll gently in and palms sway wondering where or what Indiana is, scratching their heads. What is a “Ft.” anyway. I like that image. Kona coffee and a baffled islander searching Wikipedia for Ft. Wayne. But, that means property taxes will also be going up with assessors newly armed with this inspiring bit of proof. I will guess they can justify a 20 percent jump on the backs of the article alone.
On the other hand, I would like to sell two or three properties, so I dream of a new bubble, a great run up in prices that brings realtors and clients to my doors with wads of cash, that is, if the banks ever start lending again.
But, it is an interesting statistic. We have prided ourselves here on affordable housing as a way to off-set the lack of beaches, mountains or a nifty downtown when attempting to lure business here. Lotta house for the money. One card less to play, eh.
And, we have prided ourselves that prices here have not suffered the great swings in value of other glitzier place like Yuma and Spokane and Scorpion Gulch; but nine percent is substantial, it qualifies us as a bona fide member of the boom category, and the article reads that the growth was just in the second quarter of this year. Boom. Now, if the banks will just start lending again.
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On a rental my property taxes are high enough.
I don't need an assessor claiming my properties are worth more than they are.
It barely pays to own them now.
But that is good news, that our economy must be turning around, even though Navistar will probably be leaving.
Navistar will take 1000 or so jobs. That means a thousand or so vacant houses on the market. You understand, I am sure, the many ramifications, most unsavory.
How do they come up with these numbers? Unless it's from consecutive sales of the same houses it's by extrapolation and conjecture.
By the way I would be happy to show up at your door with a wad of cash. Just send me the wad of cash and I'll be over.
Jim:
Have to wonder WHERE these particular houses are, because they are NOT on the SOUTH side (where the city's SECOND HIGHEST buying power resides…along with all the drug dealers).
Regarding a 9.2% "jump"…our property DROPPED damn near in HALF in only 14 years…astounding.
That brings our property tax total to…let me see…$89.00 EVEN.
(for the ENTIRE YEAR…that's down from close to $700.00 in years past, giving us lots more money for important things…like AMMO)
Who said dodging bullets and dealing with human flotsam DOESN"T have it's UP side, eh?
Have a great weekend, people.
Hey, Bob, I am also scratching my head. I doubt my house has greatly appreciated, I know a good friend whose mansion has been on the market three years with hardly a nibble. So, perhaps Aboite and St. Joe, maybe toss in Washington. I merely report what I read.
If he banks were to start lending again. I can't even refinance now because I am a landlord and self-employed. Although my credit score is in the 800s, although I have never missed a payment ever, never been late ever, I am not good enough for the bankers now. I think there was a story about how they found a loophole in the bail out provisions that allowed them to eschew writing mortgages in favor of playing the float market. Less risk and a guaranteed return. Instead of doing what the American people wanted and signaled through congress the bankers, who caused the mess in the first place, along with their enablers on Wall Street, have further tightened credit and are as responsible for this sluggish "recovery" as anyone, probably the most culpable.
Jim,
Jim,
Did the Journal say this was an increase of home selling prices or an increase of home values? If it's the latter, then they may have simply looked up assessed values. Theoretically, assesed value is supposed to be derived from actual market value, but I just wonder if this article is helping to point out that that's not actually the case.
This is a complicated shell game. If they can't raise your tax rate, they will simply manipulate the numbers so that the can increase the value of what you are taxed on.
A nice Federal lawsuit complete with a grand jury and people in handcuffs might ease my mood.
Well, I have received tax assessments on seven or so of my properties and they all went up by about 10%. I could challenge them and I probably should on the ones which seem highest and most out of line, but most are not that far from my evaluations. I don't mind paying my share for community needs. I do mind when I read of deals where abatements are given for questionable projects and where there is little follow up to determine whether what was promised was produced.
Remember, it was the Wall Street Journal and the kitty box got that copy a day or so ago. It described the rise as in property values. No asterisk to explain the computations for each of the thirty or so cities shown, those being the top 15 and the bottom 15 from all across the country where different laws underlie the assessment and evaluation process. So, Phil, I would guess that, as we are now on a system that uses comps to assess value that home sales are up and the prices are significantly up. I no longer have a close friend in the realty business, so I will have to work a bit to get the anecdotal and analytical assessment of local sales, but I will guess that homes in the 100k to 175k range are leading the way, enough so to influence the overall numbers. I know it is hard find cash to buy investment properties. My friends and I are asked for stacks of justifying documents only to be turned down due to….something. I guess also that because house prices were so depressed in the last year that the significant rise is also a reflection of a significant fall in prices. (Did that sound like Greenspan?)
As a Fort Wayne Realtor I have full access to the Fort Wayne Multiple Listing Service. For those that are interested, here are the sale numbers for the periods 8/27/08-8/27/09 & 8/27/09-8/27/10. There were 3,667 sales in Fort Wayne between 8/27/08-8/27/09. The total dollar value for those sales were $395,595,500.00 with an average sale price of $107,880.00 Compare this to the sale period between 8/27/09-8/27/10, which there were 3,932 transactions. The total dollar value for those sales were $442,457,514 with an average sale price of $112,527.00 If my math serves me correctly the difference between $112,527.00 & $107,880.00 = 4.3% increase! I am not sure what data points the WSJ is using or where this data that was used came from.