Asking Price:  $1,285,000

5 bedroom/3 bathroom house located on a very private street off Cliff Road.  Spacious indoor and ourdoor living.  Mature plantings.  Convenient to Step Beach, Jetties Beach and Town.  Must be seen to truly understand the opportunities.

Recently, NAREB, the Nantucket Association of Real Estate Brokers, invited the Nantucket Tax Assessor to make a presentation on the in’s and out’f of the tax rate and assessments.

Rather than take all your time with the complete presentation I thought I’d give you some headlines:

NANTUCKET ENJOYS ONE OF THE LOWEST TAX RATES IN AMERICA!

2011 Tax Rate 

 Residential                         $3.58 per thousand          

Open Space                         $3.42 per thousand           

Commercial                       $6.41 per thousand

Tax breakdown between seasonal and non-seasonal residents

10% paid by year around residents

20% paid by island owned investment property owners

70% paid by second home and investment property owners (non-Nantucket residents)

Full time, primary, owner occupied homes enjoy a residential exemption.

By law that exemption can only be 20% of the average residential home value.  In 2011 that is $1,524.960 for a deduction of $304,992.A

All assessments are a rear-view mirror on the market.

Every three years the market revalued.

2011 was just completed based on 2009 sales.

2013 will be the next  revalue based on 2010 sales.

If you have further questions or wish the complete presentation, please contact me at marion@countryvillagere.com

(source:Nantucket Tax Assessor)

2010 was a good year for the Nantucket real estate market.  Dollar sales were 59.6% ahead of last year for a value of $694 million versus $435 million in 2009.  364 properties sold versus 238 in 2009.*  On average, properties have been selling at 90% of last asking price, a trend we have seen hold thoroughout the year.  This is a reflection of more realistic sellers.  Prices have come down between 20- and 30% since the pre-recession market highs.  With 424 properties on the market today, this is not only a reflection of ‘off market’ for the winter, but the fact that properties are moving.

This coupled with the positive daily national numbers may indicate that we have seen the bottom.

*source: LINKNANTUCKET

If home price drops, so should property taxes. Home owners might be smart to initiate a property tax appeal.

By John Garippa

| November 2008

In these uncertain times, many home owners have had to face the fact that the current market value of their homes is less than they once thought. 

Yet, most of these home owners continue to pay property taxes based on that higher value. 

Higher taxes may also make a property less appealing and affordable to buyers, since higher taxes will increase their overall costs, at least until the property is reassessed. That’s why it’s a smart strategy to advise past clients who might be considering a sale to appeal their property taxes at the next opportunity.

Evaluating Your Assessment

The vast majority of taxing jurisdictions throughout the United States assess residential property based on market value: the amount a willing buyer would pay a willing seller without duress. However, assessments are generally not reviewed on an annual basis, so a property’s assessment will never be 100 percent of market value. 

To compensate, taxing bodies apply an equalization ratio, which is designed to ensure that assessments are relatively equal among different taxing districts to all assessed values. For example, a property worth $100,000 with an equalization ratio of 50 percent would be assessed at $50,000. Home owners can obtain their equalization ratio from local taxing authorities.

If, after a review with a residential broker or appraiser, a home’s assessed value seems out of line with current market values, the home owner should undertake an investigation to determine what might have caused the incorrect valuation. Here are some steps for your client to follow.

1. Arrange a visit with the local tax assessor and request a complete copy of the home’s tax records. Property record cards are public records and are universally available.

2. Pay particular attention to the market comparables listed on the property record card. These recently sold homes are the basis for the assessor’s valuation of your client’s home. Visit those houses or view them online, and compare them to the client’s house.

3. Take the appropriate equalization ratio and multiply the market value you believe appropriate for the home by that rate. If the number is lower than the current assessment, your client should file a tax appeal.

Filing an Appeal

Most home owners should be able to properly file the appeal without counsel, but most jurisdictions require a licensed real estate appraiser to prepare an expert analysis of local market values for the local tax board.

Home owners should work closely with the appraiser to review all the amenities and issues that might affect the valuation of their home. Many times an appraiser may not be aware of construction, zoning, or general neighborhood issues that negatively affect value. 

Real estate brokers familiar with the property and the area may also be a valuable resource for this type of information. They may also be able to assist the appraiser in determining which properties are the best comparables for a particular home. All of the appraiser’s conclusions need to be properly documented with supporting evidence in the appraisal report that will be submitted with other supporting paperwork prior to the hearing.

In addition to compiling evidence, the taxpayer should take care to learn and follow the rules of the local board of assessment review. Each taxing jurisdiction has appropriate appeal forms. It is also critical to determine the deadline for filing an appeal.

The final step in an appeal is a hearing before the assessment appeal board. Proper preparation is the key to a successful hearing. The home owners and the appraiser should prepare a script detailing the important points that need to be made during the appraiser’s testimony in order to prove a lower market value and assessment. 

The key focus should be comparing the home in question with every presented comparable. The appraiser should be prepared to analyze each important amenity and discuss how it positively or negatively affects value.

During uncertain economic times, the effort of appealing a property tax bill reduction may prove well worth the time and effort involved.

You can contact the staff of REALTOR® magazine by e-mail at narpubs@realtors.org.

Well Wine Festival and Memorial Day/Figawi came and went and the inventory continues to grow, despite a handful more properties going under agreement. 

The entry level of the market, those properties under $1mm, appears to be growing in size and I anticipate some price softening as properties stay on the market longer and the would-be buyers who need financing will find it more difficult to secure affordable financing as lenders tighten up their standards. 

The middle of the market, those properties between $1.5mm and $4mm, still shows strength, but only those properties that are priced correctly from the time they get listed; those properties that have been price reduced from inflated levels are not seeing the same action. 

As may be expected, the upper end of the market, those properties over $5mm, looks to be growing in strength as buyers of these types of home buyers tend to purchase without financing and they have enjoyed gains in their other asset portfolios here in the US and abroad. 

Please feel free to contact me if you or someone you know would like to discuss acquiring a Nantucket property.