Friday, August 4, 2000
Hot summer reading: Carlisle real estate ads
The fourth Harry Potter doesn't light a candle to the real sizzler of the summerthe Carlisle real estate ads. Though brokers don't claim to have a crystal ball, everyone contacted for this article agreed that the market, which traditionally cools off in the summer, will remain strong. "The trend will continue," said Hunneman broker Brigitte Senkler, "but not as wildly as before the NASDAQ dropped in the spring. The question is, how high?"
What is of concern to buyers, and increasingly to Carlisle residents too, is that incomes have not universally kept pace with the inflation in real estate prices in this area. With sale prices on an upward trend (see chart on page 7) not only do people who were born and raised in Carlisle find it hard to buy a home here, but also more people whose homes are currently on the market find themselves in an odd situation. "Most people would not want to buy their own house back at the asking price," said Senkler.
The steep price tags do not appear to deter all house hunters, however. While it is true that many couples who start looking in Carlisle then go to surrounding communities where their dollar goes further, according to veteran Barrett & Co. broker Carolyn Kidd, most buyers who are interested in Carlisle stick with their search here. These people know the prices in Carlisle and have made offers but haven't yet found a match. The people who are hurt most have stretched their budget to look in Carlisle and can't compete when a bidding war erupts. "People with nothing left in their budget have a terrible time," observed Kidd. "There are so many people with deep pockets."
It seems that people have more money than time, as Laurie Cadigan of Carlson Real Estate observed. Cadigan said that there is an incredible amount of pent-up demand for houses in really good condition. It is still a seller's market as long as the property is in good shape and in a good location, meaning not that there is a wrong side of the tracks in Carlisle, but that the lot consists of "a nice piece of usable land." Cadigan also said that unusual houses, such as antiques, bring good prices because a lot of people who look in Carlisle are looking for something out of the ordinary.
All of the brokers agreed that the biggest demand is for houses between $300,000 and $500,000, but sales statistics for the first half of 2000 show that only 10 of the 32 houses sold this year fell within that price range. The median price was $593,000. The average price was $662,909. The highest price was $2,350,000. The lowest price was $230,000.
The real shortage is in the availability of lots for new construction. House lots this year sold in the $280,000 to $290,000 range. Senkler said, "All new construction will top $1 million" as the demand for large homes continues. "I keep telling builders there is a market for smaller, really well-built houses," continued Senkler, "but for some reason, they all turn out big."
Carlisle is marketed as a young community with great schools and a good commute to Boston or the surrounding high-tech employment hubs. Senkler sees most buyers being two-income couples with children. Kidd also sees the typical buyers as dual-income with children but she also sees many clients in their 40s and 50s with no children who are looking for a "family-size" house. This type of buyer looks in Carlisle for privacy, rural ambience and proximity to a business.
Impact on taxes
According to town assessor Rena Swezey, the spiraling real estate values will have an impact on property revaluation which is required for triannual recertification. Swezey explained that, under state guidelines, every three years real estate must be valued at 100 percent of market value. As of last fall, the average assessed value of property in Carlisle had dropped to 83 percent of market value. The revaluation now going on, which will be reflected in the next real estate tax bill mailed this fall, will result in an average increase in assessed value of nearly 26 percent.
Under state law, Swezey said, the assessor must use sales data from calendar year 1999 as a basis for the revaluation. For houses sold in 1999, the assessed value will be the sale price. All other houses will be adjusted using 1999 sale prices as a model. Although data from this calendar year won't be used, Swezey said it would have pushed values even higher.
To explain the dramatic increase in assessed values, Swezey plans to send each landowner a new property record which breaks down the valuation. Most of the increase will be in land value but there are also increases in the formula for calculating building value. There are 12 different styles of homes, each with a different assigned value per square foot. New houses in Tall Pines, for example, are termed "custom colonials" and are assessed at $65 per square foot, while colonials built in the 1950s are assessed at $55 per square foot. Deck houses will be assessed at $43 per square foot. Condition, as well as improvements, are taken into account, and a field inspection is required for each house once every six years. A new kitchen will add $12,000 to assessed value (up from $7,500), and a new bathroom will add $7,500 (up from $3,500). These figures have not been updated since 1993.
For those worried about their tax bills, Swezey explained, "Historically, when the tax base of the town increases, the tax rate usually goes down. Last year, the rate was $17.80, but it will hopefully be lower this year." The new rate should be certified by September 1.
Taxes generally not a deterrent
From Kidd's experience, most potential buyers do not talk about high real estate taxes as a deterrent. Kidd observed that young families seem to have more money these days, and that families with children tend to compare real estate taxes favorably against the cost of private school.
© 2000 The Carlisle Mosquito