Real Estate Pro Articles
   
   

Foreclosure Listings - Problem for Local Tax Assessors



[Valid RSS feed]  Category Rss Feed - http://www.realestateproarticles.com/rss.php?rss=265
By : John Cutts    99 or more times read
In the Twin Cities, taxpayer advocacy groups like the Taxpayers League of Minnesota, have criticized housing valuations distributed to homeowners in preparation for property tax payments in 2010, claiming that the valuations did not reflect home value declines largely caused by growing houses listings.

Despite the 20-percent decline of median housing prices across the Twin Cities region, tax assessors in Dakota, Ramsey, Anoka and Washington counties recorded median home prices declines as only six percent to nine percent.

Stephen Baker, the tax assessor of Ramsey County, argued that home price studies indicating a decline of 20 percent are not accurate because these studies have overestimated the impact of Minnesota foreclosures and foreclosure listings.

Baker added that foreclosures, especially bank owned foreclosure properties, are different transactions. He said bank owned foreclosed homes are limited to a small market. Besides, he said, properties in foreclosure listings do not sell at a good price because they need costly repairs and some are not even livable.


The difference in the home price declines arises because home sale price surveys include sales transactions involving properties sold from foreclosure listings or auctions. Tax assessors however do not typically use foreclosure listings prices in their estimations.

In the two cities, around 60 percent of houses sold through the Multiple Listing Service and other foreclosures listings providers in January were foreclosure properties.

For nationwide assessments, the arguments of the analysts of Standard & Poor’s Case-Shiller Home Price Index are instructive. The Case-Shiller Index, among the most reliable indexes for home prices, considers the prices of properties in foreclosure listings in its assessment of home prices in 20 major markets across the country, including the Saint Paul and Minneapolis metro areas.

David Guarino, a spokesperson for Standard & Poor’s, explained that it is not logical to exclude prices of properties in foreclosure listings. He argued that many of the properties in foreclosure listings now were purchased during the housing boom with subprime and high-risk mortgages, the major reason for the fall in home prices today.


As a commentary on the arguments, Phil Kirkie, leader of the taxpayer advocacy organization in Minnesota, said the difference between home price assessments by tax assessors and home price researchers indicates the arbitrariness of tax assessment, depending on the impact of home price levels on their interests. Tax assessors, he argued, do not want to recognize the decrease in home values because they do not want to reduce the base of their revenues.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

Related Articles



Actions
Print This Article
Add To Favorites



Sponsors

 

 

© All rights reserved to Real Estate Pro Articles