Friday, November 7, 2008
Assessors to adjust property valuations
Although it is not a revaluation year, the recent drop in real estate prices has prompted the Board of Assessors to undertake an interim evaluation of Carlisle home values. Most assessments will be reduced; however, board chair Jim Marchant hastens to note that this will not mean a reduction in taxes. Instead, the tax rate will rise to maintain revenue at a level which will cover the budget passed at Annual Town Meeting last spring.
“We are at the threshold where the DOR [state Department of Revenue] would have told us to do [a revaluation] anyway,” said Marchant. Properties are typically revaluated every three years, and Carlisle is not due until 2009. However, state law requires an interim assessment when prices have risen or dropped more than 10% of assessed value. According to Marchant, Carlisle sales prices are running about 8% below assessment, and rather than wait, the assessors decided to get assessments back in line. He expects another adjustment will be made next year.
Smaller homes may shoulder larger share of taxes
Each Carlisle property will be reassessed according to weighted factors and some will see larger drops than others. Since land values held steady, smaller homes where the value is disproportionately in land may see less reduction. Homes of different styles will see varying reductions, as style was found to significantly impact Carlisle sales prices. A few homes may even go up in assessment, usually as a result of recent renovation.
Values based on 2007 market data
Marchant says the analysis is rigorous and market-based, “No one is treated unfairly.” Although it would be easy to just reduce everyone’s assessment by 8%, the DOR does not allow that. Instead, the town must undertake an analysis which weighs the factors impacting prices. Land prices were analyzed separately and, unlike neighboring towns, land was found to have held value in Carlisle. As for house prices, about 20 factors, including square footage, style, condition and age were considered. The last completed sales year, from January to December 2007, was the basis for the analysis.
Carlisle hired a consultant, Patriot Properties, to do this work. Once their report was complete, the board checked that the predictions of the analysis dovetailed with actual sales prices. Satisfied they had accounted for market discrepancies, they sent the numbers to the state for approval. That approval was received on Monday, and the reassessment will be reflected in the next tax bills.
Marchant was surprised that Carlisle land prices are holding steady. As president of Minuteman Appraisals, he evaluates land throughout the region and notes Carlisle is “one of few towns around (with steady land prices), and that’s basically good news” to homeowners. Although many housing lots are on the market in Carlisle, demand is high and big developers seem to be able to hold on long enough to avoid price reductions.
Revaluation again next year
As required, another Carlisle assessment will be conducted next year, this time using 2008 numbers. Marchant predicts there could be another reduction. Looking at the Massachusetts market in general, he says, “There’s a lot of bad stuff happening out there.” For example, there was a case of foreclosed condos that sold last year in Lowell for $150,000 and are now being offered for $30,000. On the other hand, - three homes recently sold in Concord for over $2 million will all be torn down by buyers who will build even bigger homes.
Carlisle property owners with questions about their assessments are encouraged to speak to Town Assessor Melissa Stamp. Any documentation for price comparison should be from December 2007 or earlier as, by law, 2008 sales are not relevant to the current year’s assessment. ∆
© 2008 The