Property Tax Appeal Blog | Daniel Jones (55)

Daniel Jones

Retail Vacancy Issues

Relative growth in vacancy rates since the start of the Great Recession:

A class-A office building sold in Atlanta recently. Promenade Two, a 774,000 square foot building in Midtown was purchased by Cousins Properties. The reported sale price is $134,700,000 or $174 per foot. The building is 42% vacant. Jones Lang LaSalle reports that the vacancy rate in Midtown is 24.4% and that is the highest in the metro area. Net absorption was negative in the third quarter in Midtown. Jones Lang LaSalle report that the average office rent in Midtown is $23.75

The best properties in the best locations are still commanding high prices per foot. But with Midtown having the highest vacancy rate of all the Atlanta metro sub-markets can it really be considered a "best location" at this time? Perhaps. Vacancy rates are high in most markets and relatively speaking Midtown's vacancy rate isn't that bad.

Bifurcation. There's the top tier properties, and then there's everyone else's properties. If you think the assessor has your property in the wrong group don't feel singled out. There are a lot of other properties owners being associated with the Chosen properties (you know, the only ones selling) out there. For help getting the assessors to "see the light" talk to the property tax appeal professionals at Fair Assessments LLC.

Happy Holidays

Back from Thanksgiving with a cold, but all is well otherwise.

The S&P Case Shiller house price index dropped 3.6% for the year ended in September which was a larger drop than experts had predicted (3.0%). Of the 20 cities in the index 18 had a year ended September decline and Atlanta had the largest drop in house values at a whopping -9.8%. Much of the blame is being laid on lenders that have increased foreclosures recently and are adding to the inventory of available properties when there is already a glut and little demand.

Builders are on pace this year to sell the fewest new houses since record keeping began in 1963. 2010 was the slowest year ever for new house sales but it looks like 2011 will come in dead last. As noted above, builders are competing with a glut of existing inventory that is sitting, weighing on the market.

CoreLogic reported that over 1/4 of all mortgaged houses in the USA are underwater, or are close to owing more on their mortgage than their house is worth. Homeowners with negative equity are more likely to have above market interest rate mortgage loans. This makes perfect sense since most underwater homeowners cannot pony up additional funds to create 20% equity needed to refinance now. Those that are not upside down are more likely to have enough equity to refinance.

That was a quick autumn. December is here and the air has turned crisp here in Atlanta. The assessor's effective date of appraisal is just 31 days away. Gather your market data before it slips away and prepare for your 2012 appeal. For assistance with all of your property tax appeal needs contact fairassessments.com

Residential Property Tax Appeal News

Fannie Mae says that consumer confidence is still cause for concern regarding the housing market. Fannie Mae economists are projecting that 2012 home sales will be only slightly higher than this year. Construction was up in September, but it was primarily due to apartment construction. Home builders say that it is still very difficult to compete with all of the distressed properties on the market.

It was recently announced that the Federal Housing Administration (FHA) is getting low on reserves and may need to go to the Treasury for more money. Adding to the worry it was reported that more than 30% of all mortgage modifications made by FHA in 2010 defaulted again within a year. Foreclosures on FHA insured loans declined in September but this was attributed to the slowdown in foreclosure processing due to the robo-signing scandal.

Lender Processing Services (LPS) recently announced that mortgage delinquencies declined in October to 7.93% of outstanding loans, which is down 2% from September and 14.6% from a year ago. LPS information shows that approximately 6.3 million properties are in foreclosure or are 30 days delinquent. The states with the highest percentage of delinquent loans are Florida, Mississippi, Nevada, New Jersey and Illinois.

Fitch has data showing that home values have fallen 7% over the past year. They say that now brings the total decline in housing values nationwide to 38% since the peak. Fitch believes that home prices have not reached the bottom and they expect prices to fall another 13%. They blame the continuing weakness in home values on high unemployment, stricter lending standards, and the glut of distressed houses on the market.

The assessor's effective date of appraisal of January 1 is approaching quickly. Do you know where tax rates are headed in 2012? Do you know what's happened to values in your market area? Here at Fair Assessments, our job is to know the real estate market and know how to save you money. If you own residential real estate in Fulton County, DeKalb County or Gwinnett County, Georgia we can help you with your property tax appeal.

Commercial Property Tax Appeal News

CoStar recently reported that their commercial property sale price index had a 0.9% increase in September over August. Accounting for the increase were the still recovering retail real estate sector and the red-hot multifamily sector. Distressed sales accounted for 25% of the sale transactions used to calculate the 0.9% increase. Nondistressed property prices rose 2.3% for general properties and 1.9% for all commercial properties. Distressed properties continued their sale price decline. Costar said that the multifamily sector index increased 2.1% during September and had been up 7.3% in the second quarter. The multifamily index has increased a total of 12.3% since the market bottom and has outperformed all other property types.

Shadow Inventory and the FHA Time Bomb

There is much variation in the estimate of the number of homes currently in foreclosure and those that are seriously delinquent. As I noted in a previous blog post Lender Processing Services estimated that the number of delinquent and foreclosed properties was approaching 6.4 million. Different real estate research companies have differing ways of estimating this number however, and the estimates range from 1.6 million to 8.2 million delinquent mortgages. Capital Economics estimates that the shadow inventory is 4.3 million homes and they call this a cautious underestimate. They say that with 4 million homes waiting to be eventually added to the supply of properties for sale it will take 18 months to clear both the visible and shadow inventory of homes.

Atlanta Apartment Market Shows Signs of Life

The stalled mixed-use project called 12th and Midtown is about to see some new construction. All over the country the apartment market is doing very well because very few people can get mortgage loans to buy houses due to increased lending standards or they just refuse to buy because they think housing values have further to fall. This is been boosting occupancy and rent in apartment communities nationwide. Atlanta, of course, has not been immune to this trend. The vacancy rate in Midtown Atlanta has fallen to 7.2% in the third quarter, which is down from an 11.4% vacancy rate in the third quarter of 2010.

Atlanta Property Tax Appeals

Lender Processing Services (LPS) says that they track home sales on a monthy basis and their home price index gives them a quick read on changes to the market. Their data shows that house price declines were widespread, throughout the country, in August but that higher priced homes declined less than lower priced homes. Of all the cities that they track with their index the city with the largest home price decline in August was Gainesville, Georgia.

The city with the largest price decline since the beginning of this year, as measured by LPS is Atlanta, GA. The Atlanta metro area shows a 2011 price index decline of -10.5%. The city with the second highest price decline was Phoenix, AZ with a 2011 decline of -5.2% or about half of the drop experienced (here) in Atlanta.

If you want property tax relief in the coming year and you would like the help of real estate professionals that are saving property owners 21% on average in 2011 contact Fair Assessments, LLC. We are your Atlanta based property tax consulting firm. Our 20+ years experience in real estate appraisal, property tax assessment, and property tax reduction is unequaled. For help with your property tax appeal contact us.

No Penalty For Piling On

The negative news and forecasts for the residential real estate market just keep on coming. Recently Pacific Investment Management Company (PIMCO) predicted that housing values could decline another 6-8% before hitting a bottom. They blame it on tightened lending standards that are shutting many Americans out of the housing market.

Lender Processing Services (LPS), the company that recently reported that 6.4 million mortgages are delinquent, also announced that their home price index has declined 3.8% year over year as of August. In the month of August they show housing values fell 0.9%. Their home price index shows that nationally, home prices have fallen 28.3% on average from the peak in mid 2006.

If you would like to save money in 2012 consider appealing your real estate property tax assessment. If you live in the Atlanta metropolitan area and would like professional assistance with your property tax appeal contact Fairassessments.com

Defaults and Foreclosures

Realty Trac, Inc. reported that default notices increased 10% in October as compared to September and rose to an 11 month high in states where foreclosures must be processed through the court system. Nationally, auction notices increased 8% and home seizures jumped 4%. Nationally foreclosure filings increased 7% to a seven-month high in October after a year-long slowdown due to the robo-signing scandal.

Over a quarter of one million properties received default notices, auction, or repossession notices in October. The number of notices was actually down 31% from a year ago as one year ago was when the complaints started being raised about the foreclosure process and faulty/forged documentation. Realty Trac also estimated that the nation's housing market may need as long as 40 months to clear all of the distressed sales.

If you need help with your property tax appeal please visit www.fairassessments.com and contact us for your Fair Assessment.

Daniel Jones

Recent Posts

Retail Vacancy Issues

Atlanta Office Values

Happy Holidays

Residential Property Tax Appeal News

Commercial Property Tax Appeal News

Shadow Inventory and the FHA Time Bomb

Atlanta Apartment Market Shows Signs of Life

Atlanta Property Tax Appeals

No Penalty For Piling On

Defaults and Foreclosures

Daniel Jones

Recent Posts

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