Sunday, February 05, 2023

Assessing assessments

by Alecia Warren
| June 20, 2010 9:00 PM

When many Kootenai County residents opened their property assessments this month and saw their assessed values had dropped, Kim Cooper started getting calls.

"Some people panicked, wanting to know if they were asking too much for their house," said Cooper, spokesperson for the Coeur d'Alene Association of Realtors. "My advice to them was, 'Ask your Realtor.'"

Opinions vary on how lower property assessments affect asking prices for houses, an issue on many people's minds since the county's overall assessed value dropped $2.1 billion from last year.

According to Cooper, though, a lower property value assessment doesn't mean sellers have to automatically ask less for their home.

After all, property assessments are based off sales data collected from the year before, Cooper said, and don't reflect the current state of the market.

Prices have stabilized, for instance, since data was collected throughout 2009 for this year's assessments.

"The data they used for the current assessment is actually almost 6 months old," Cooper said. "The decline has slowed (since then)."

Asking price is usually just determined by the situations of buyers and sellers, he said.

If someone is desperate for a certain kind of home, the individual might shell out more than the assessed value, he said. If a family is eager to move, it will likely accept less than the assessed value.

Supply and demand plays an obvious role, he added.

In today's market saturated with available homes, sellers will have to lower prices to stay competitive.

"I think they (sellers) should take that (property assessment) as one more bit of data when pricing their house, but more important is to look at what houses in your neighborhood are selling for," Cooper said. "If there are a bunch of foreclosures in your neighborhood, you'll probably have to look at a lower price than before there were a bunch of foreclosures."

Mike Threadgill, co-owner of Keller Williams Realty Coeur d'Alene, said he usually looks at property value assessments as unrelated to determining the price of a home.

"The assessed value is the assessor's opinion of what that property is worth related to similar properties, but there are things they can't quite take into effect," Threadgill said. "Like location, neighborhoods, uniqueness of the property. Often times layout and quality of construction also impact values."

Even after the assessment notice is put in the mail, he added, every individual involved in a sale will have their own opinions of value, including the seller, buyer and realtor.

"Even the bank will have a different opinion," he said.

Chuck Taylor with Realteam Real Estate Center in Coeur d'Alene, however, said that property value assessment is one of many factors that play into asking price.

It's psychological, he said.

People see a lower assessed value and expect a lower asking price.

"I think that's a lot of people's concerns," Taylor said, adding that this particularly applies to those who purchased homes during the property value spike in the mid-2000s.

The economy in general influences what people can get for their homes right now, he said.

"They just don't have the wherewithal to go out and create an economy here that allows people to move here and pay a higher price for a home," he said.

Still, the area continues to be a magnet for retirees, he said, who help maintain some demand for homes.

Duffy Smock, managing broker and co-owner at Windermere Hayden, said that assessed value is one of many details realtors should research to help a buyer pinpoint the best price for a home.

"If someone is asking much higher than the assessor has valued, it leads the buyer and buyer's agent to say, 'Well, why?'" Smock said. "There are no absolutes, but it's our job to look at the market, and part of that is the assessments."

Coeur d'Alene resident Scott Romine saw that his property assessment dropped moderately this year, he said, but he didn't panic that it would affect how much he netted for his home for sale in Canfield Corners.

"We had this house built in 2004, so the prices hadn't really started to spike yet," he said. "When we saw what assessed values were last year and this year, we saw things coming back to Earth."

And indeed, the family didn't have anything to worry about.

Romine sold the home in three days.

He was comfortable that the offer was just under the assessed value.

"I would have liked to have gotten all of it," he admitted. "But I can say as far as houses in my subdivision, we got what anyone else has been getting for their house."

He hopes to take advantage of the market, he added, and the family will rent while he searches for a home with a slashed asking price.

"With the deals that are out there, moving immediately into something doesn't make sense," he said. "We're going to explore the market and see what kind of a deal we can get."

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