Adams Homes Selling Higher Than Assessed Value
ADAMS, Mass. — Homes in Adams tend to sell 8 to 14 percent higher than their assessed values.
"That's a good thing, and it is good to see the values increasing in town," Town Administrator Tony Mazzucco told the Maple Grove Civic Club on Sunday. "North Adams and Pittsfield in their last cycles have seen it a little bit so maybe they are catching up, but we are seeing our values go up."
Mazzucco was filling in for Town Assessor Donna MacDonald on explaining the recent town revaluation. And while only a handful of club members showed up at the PNA because of Sunday's snowstorm, he went through the full presentation of what an increased assessed value means.
Many homes have increased in value, he said, are selling sometimes up to 14 percent higher than their assessments. Mazzucco said this is good news but the town needs to continue this trend for years to become more financially stable.
The state asks that communities go through a revaluation every 10 years. Mazzucco said those revaluations also helps the town catch up on residents who have made improvements to their home without applying for a permit.
He said the town has gained value through the latest revaluation and many homes came in with higher assessments. If people updated their homes or added to them, they probably saw an increase in value.
There have been about 30 transactions just since the beginning of August. In one example, a home on Grant Street assessed at $155,100 sold for $182,000, or 17 percent higher than its assessment. A home on West Road sold for almost $100,000 over its assessed value and another on Summer Street sold for 16 percent above, according to town and state records.
Mazzucco explained that the tax rate is relative to a community's property values. The town still must raise the same amount of money to operate and lower taxes usually translates to higher property values, and vice versa.
"The town of Hadley has exactly half the tax rate as us but their total property value is double ours," Mazzucco said. "Their average tax bill is actually a little bit higher than ours so you are always paying the same. It is just about how it looks."
The town administrator added that the town needs more growth if it wants to start lowering the tax rate.
"I think the community isn't growing enough," he said. "The town needs the same amount of money to run one way or the other ... and we need more than a few new sheds and decks to grow."
He said currently the town sees $50,000 to $100,000 in new growth annually but needs to grow four to five times that to substantially lower the tax rate.
Adams is pretty much a built-out community and it is unlikely it will see substantial new construction, Mazzucco said.
"We physically can't build that much more and add more properties," he said. "The values have to increase or properties have to get bigger, and we are most likely not going to see 10-story buildings in Adams."
Mazzucco also noted that the town's commercial value is very low and commercial property often sells far lower than the assessed value.
"The Mausert Block sold a few years ago for $70,000 and the Jones block sold a year ago for $150,000," he said. "Our commercial properties in town are selling for dirt and that's unfortunate. That's one reason the commercial property values have come down while residential has gone up. We aren't seeing the same growth."
He added that the assessed value has some bearing on what properties sell for but location tends to dictate how much people are willing to pay.
"The same home in Adams would probably sell for the same dollar amount in North Adams but it would probably sell for a little bit more in Lenox," he said. "If you moved that same house to Cambridge it would probably sell 10 to 20 times more."
Mazzucco added that the specifics of a transaction are recorded to prevent non-arm's length transactions from tanking a neighborhood's value. He said parents will often sell their home to their children for a low amount that does not honestly reflect the market.
Arm's length transactions are traditional sales between people who just want to sell or buy a home and truly show what people will pay for a property.
Mazzucco said even though homes are selling higher than assessed value, they are not selling high enough to change how much state aid the town receives.
The Maple Grove Civic Club meets the third Sunday of the month at the PNA to discuss topics of civic interest; guests and new members are always welcome.
Tags: assessment, Maple Grove Civic Club, property taxes, Real Estate,
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