Wednesday, November 17, 2010

Current REAL ESTATE Market Anaylsis, Horseshoe Bay, Marble Falls, & Meadowlakes

The months of March through October are usually our highest volume sales in the Highland Lakes of the Texas Hill Country. A quick analysis for the previous twelve months’ home & lot sales for Horseshoe Bay, Marble Falls, & Meadowlakes (my primary market area) might be of interest. I’ve prepared spreadsheets that sort Oct. 2009 to Oct. 2010 sales by city, by category, & in some cases, by subdivision. If you'd like copies, just send me an e-mail: JanLBusse@Gmail.com & I'll gladly share. My current listing clients get these regularly.

If you compare this year versus last year, our quantity of sales are almost flat. Anecdotally, however, my buyers seem to be asking two very important questions they were not asking before:

  1. What's the best DEAL (value) for the money regardless of price, category, or location
  2. How much more can I get if I move my price point UP to the next "xxx" number of dollars

During the 2008-2009 sales year, our market sold almost exclusively houses under $300,000 and over $1million. This year, we see the BEGINNING of mid-level ranged houses selling again. Yes, they must be great prices, exceptional properties, or exceptional values -- HOWEVER THEY ARE SELLING AGAIN.

  • “Single Family & Condos Sold” are heavily weighted toward NEW construction, regardless of city or category.
  • Most buyers resist remodels in our market, especially when new homes are available at reasonable prices, so older home sales have been hardest hit. Subsequently, they may also be the biggest opportunity for bargain hunters.
  • Until recently, there have been a number of new construction foreclosures on the market, which drove down prices even further. This is especially true for condos & townhomes
  • Today, there are fewer “single family, distressed” properties available & I don't foresee many more showing up in this category any time soon.
  • Condos, especially “The Waters,” may see still more foreclosures this year
  • Golf course homes, which were also very slow selling have begun to see activity again, especially in new construction & higher end houses (those asking over $500,000)
  • Another surprise for our market, is “Waterfront Single Family Home Sales” have slowed, while inventory is very high. There are currently 88 waterfront homes listed in our MLS as “for sale” in our three cities.
  • My OPINION is that there are fewer motivated sellers in that category
  • The oil business has settled down to a more normal level of business, & in TEXAS, oil related businesses supply an unfair share of our highest end buyers
  • Currently there are only 2 waterfront condos listed as “pending” in our MLS
  • Currently NO waterfront houses are ”pending” in our MLS.

Regarding home sales, the market seems to be holding its own or even trending up, based on price points paid this year versus last year.Whereas two years ago buyers were not buying at all, today there are qualified buyers, looking for bargains in most all categories.

When buyers ask me where the best STEALS are, without fail, I tell them "buy dirt!" Lot sales have been almost non-existent in the previous 12 months, & they show no immediate signs of improving. Serious discounts are available!!!

  • Savvy investors are beginning to inquire regarding lots again thanks to the news about the new county hospital & the recent positive changes at Escondido & Skywater
  • Builder’s profits are greatly affected by land costs, so those that can bank property are looking for particular bargains.
  • From talking to several Austin & San Antonio builders, I’ve been told the land costs there are rising again, so I believe our market will soon be viewed as the GREAT VALUE it is.
  • Until most of our newer construction single family inventory is sold, land sales will like stay very slow unless sellers are willing to provide deep discounts to buyers
  • It is often cheaper to buy pre-existing new construction than to build new

Every month, I prepare spreadsheets & average the sales numbers by category. Everyone understands the averages are arbitrary. Trying to compare locations, finish outs, age of the homes, etc, is impossible. But one very important average struck me: in almost every instance, the average percentage paid for a property, compared to seller's asking price was 92% to 95%.

Today, when there are so many bottom feeders, sellers are afraid to drop their asking prices close to what they'll actually take, but they NEED TO RE-THINK THIS STRATEGY.

If the price has too much negotiating room, buyers won't make an offer, but go where they think they can negotiate with someone who's more motivated and/or realistic.

Overall, I would not say the immediate future is rosy for sellers. It remains weighted heavily for buyers, but overall sales seem to be trending slowly up. There ARE many buyers willing to purchase if the value is strong enough. It's not strictly about PRICE, but the VALUE must be apparent in every transaction.

Friday, May 14, 2010

How to Protest Your Tax Valuations

Llano Central Appraisal District (LCAD) mailed over 12,000 notices of increased appraised values to property owners this week. If you are one of the 12,000, there is a process in place that allows you to PROTEST INCREASED VALUATIONS. In anticipation of the protests, Texas Comptroller Susan Combs has prepared a video about protest procedures.

In light of our slow real estate market for 2009, a comparative market analysis (CMA) done by a real estate professional could help you verify the appreciation your county is claiming or help you make the case that county records are not thorough enough to support the increase. I highly recommend you CONTACT YOUR REALTOR for a CMA of the property & market in question.

As I explained in last week's blog, if you purchased a new property during 2009 and paid less than the county's appraised value, usually all they require to change the valuation is a copy of your closing statement (also known as a HUD statement) from the title company.

In order to preserve an objection to the district’s valuaton, a taxpayer must file a formal protest within 30 days of the date the appraisal notice was mailed, which will be June 4, 2010 in Llano County. Burnet County mailed its notices on April 30, so protests are due by June 1, 2010 for Burnet County property owners.

Texas state law requires notice sent to an owner whose value increased by more than $1,000 from tax year 2009 to tax year 2010. LCAD sent 19,000 notices of increased valuations last year. If you own property in Llano County and did not receive a notice of appraised value in the past week, then your property has not significantly increased in value, and your tax liability will not increase for 2010.

The county sets appraised value from two components — the value of the land and the value of any improvements on the land. State law requires appraisal districts to appraise property at 100% of its market value. However, after application of factors such as agriculture use, homestead caps, and exemptions such as homestead & over 65, many property owners pay ad valorem taxes on a reduced valuation.

Taxpayers who disagree with the appraised valuation of their property can contact the appraisal district for an informal review which is typically a discussion with a district appraiser who can provide information about comparable sales and how the district arrived at the value.
LLano County Website
Burnet County Website

Wednesday, May 5, 2010

Should You Protest Your Property Valuations?

A record number of property owners protested their tax valuations in 2009 and 2010 should be no different.

Why is tax-assessed value different than market value?
The tax-assessed value is what your county believes your home or condo is worth. The county attempts to set their values at a market value. However, they do not evaluate comparables nor do they perform individual market analysis on every home. The county simply values your home according to the area, not the HOUSE. Meaning, the value may be too high or too low, depending on the size, location, amenities, & condition of the specific home.

How do you determine your market value?
You can contact your Realtor who can provide you with market information, collect information from neighbors who have recently purchased their homes, or contact a company who specializes in assisting with tax assessor valuation protests. If you have purchased a home during the previous 12 months & paid less than the valuation, your closing statement is usually all the county needs to see in order to lower your valuation.

Should you appeal your property valuation?
If the market value on your home is lower than your tax-assessed value, then you should appeal. If the market value is higher, then you should not appeal.

When should you receive your property valuation and how long do you have to appeal?
The County Appraisal Districts began mailing property valuations sometime after April 15th. Most homeowners should have received their valuation on or before May 1st. Homeowners have until May 31st, or 30 days from the date they receive their valuation (whichever is later), to appeal.

How to appeal your Property Taxes?
If you believe your property valuation is higher than the current market value, you should appeal your taxes. When people don't appeal, the taxing authority accepts that their value is correct which affects all homeowners in a given area. By appealing the assessed value, we all help keep our real estae taxing authority valuations in line with market value.
  • File your protest using the protest form available from the County Appraisal District. After you have filed, it can take several weeks or more for the Appraisal Distric to schedule your informal hearing. Depending on the county, this can take place over the phone.
  • At the hearing: The purpose of the informal hearing is for you to present your evidence and facts to support your claim that they have over-valued your home, condo, or land

PRESENT YOUR EVIDENCE: The following information can be helpful to present at the hearing:

  • Comparable Market Analysis (CMA): A comparable market analysis looks at Market Value and shows recent sales for homes that are similar to yours in size, age, location and type of construction
  • Documentation Regarding Your Homes Condition: Once again, anything that would adversely affect the Market Value of your home is evidence that you can use in your appeal (if your home backs to a busy street - consider printing a Google map to document your location.)
  • Recently Purchased Homes: If you purchased your home in the last several months, and the purchase price was lower than your appraised value, bring a of your settlement statement.

Here are a couple of things to keep in mind when you talk to the County Appraisal District:

  • The Appraisal District is responsible for setting the appraised value. THEY HAVE NOTHING TO DO WITH THE TAX RATE. You are not going to protest your tax rate or how much you are paying in taxes. You are only appealing the county's assessed value of your home.
  • Bring an extra copy of all your supporting documentation to leave with the county.

To find out more information about protesting your tax appraisal, visit these sites: