April 2010 Update & $500,000 Office Sale

Richland and Lexington County seem to be experiencing a slow start to 2010 after a strong December. So far, the Midlands largest transaction dollar-wise for January 2010 is the sale of 5351 Sunset Blvd in Lexington for $500,000, a two story office building of approximately 3,100 SF built in 1996 according to the assessor's property cards.






We've also had our first REO sale of the year, a 1900+ SF triplex at the corner of Whitney Street and Maryland St. just off Olympia; purchased from Fannie Mae.

Sales data based on county assessor-stated sales prices; includes FSBO, Foreclosure and REO transaction. Please read our disclaimer regarding real estate transaction data.

Interested in details on specific transactions?
Visit MidlandsTrends.com and register for FREE access to search our real estate sales database, including FSBO sales, foreclosure and REO search!


-Terry Peterson, PMP

Appealing Assessed Values in the Market Trough - Crickentree

Someone I know very well is going to appeal their property taxes with Richland County this week. No names or exact addresses will be given for the sake of privacy, but the property in question is in the Crickentree subdivision just south of Blythewood. To assist, I pulled a list of sales from the area using MidlandsTrends.com to find some interesting yet obvious results.

Market Statistics
Keeping in mind that MidlandsTrends.com includes FSBO, Foreclosure and REO transactions; the average price per square foot for transactions in Crickentree have been as follows:

• 2007 - $128 per square foot
  
• 2008 - $107 per square foot
  
• 2009 - $102 per square foot
  

To put this into perspective, an average size home of 3,500 SF in Crickentree would have a 'value' of $448,000 in 2007, $374,500 in 2008 and $357,000 in 2009 based on the averages above.

The house in reference is currently assessed with a market value of $127/SF; put another way it is assessed at the peak value of the market. Though these numbers do not take into account any adjustment for amenities, size, age, etc. let's just say this house is exactly "on par" with the other homes in the neighborhood.

What is "Market Value" Today?
Of the sales that have occurred in Crickentree in 2009, roughly 20% are foreclosures (banks taking back a property) or REO sales (banks selling a foreclosed property). Now, an agent using only the MLS may not know of these foreclosure/REO transactions and therefore put a higher value on a property in Crickentree. There's no question if you're selling a house in Crickentree you will want to sell your house at a price point determined without consideration of REO sales. However, if you're in the market to purchase an up-scale home in Crickentree, why would you pay 'full market' asking price for a house when 20% of your new neighbors purchased their homes directly from a bank at a lower price point.

Obviously sellers would not want to consider REO sales in their 'market value' estimate while buyers would want to consider them. Buy low, sell high; right? At what point do REO's, short-sales, etc. need to be considered when determining market value? When 20% of the transactions in a neighborhood consist of such sales? 30%? 40%?

Back to the house in which the assessed 'market value' is being appealed... It will be interesting to see how the assessor views "market value" when presented with the data provided by MidlandsTrends.com. We will post an update as soon as we know the results.

Interested in details on specific transactions?
Visit MidlandsTrends.com and register for FREE access to search our real estate sales database, including FSBO sales, foreclosure and REO search