A Change for Tax Appeals

A Change for Tax Appeals

by | Feb 10, 2023 | Market Trends, Mortgage, Property Value, Real Estate

Can you explain what is going on in Allegheny with property tax assessments?

It’s big news! For property tax appeals in 2023, the PA State Tax Equalization Board has set the common level ration at 63.6%.  This is dramatically less than the 81.6% in effect for 2022.  What this means is that for homeowners appealing their property taxes in 2023, the tax assessment should be set at 63.6% of the property’s 2022 value.  This is great news for people buying their homes in 2022.  Buyers have grown accustomed to having their property tax assessment appealed after they purchase their home, and these increased assessments can dramatically impact the monthly cost of owning their homes.  This often impacts the sale-ability of a home as buyers often worry about that their monthly payments might increase to, but with new common level ratio, it is a big break for new home buyers.

For example, a home selling for $1million in 2022 should have a tax assessment of $636,000, which is an outstanding possibility.  Likewise, a home selling in 2022 for $500,000 should have a tax assessment of $318,000.

Of course, buyers in previous years could consider appealing their tax assessment as well.  For example, if a home was purchased in 2021 for $500,000, applying the current year percentages, it might have an assessment of $408,000.  We did see dramatic appreciation in 2022, so that home might be worth $550,000 today, but applying the 2022 ratio of 63.6% to 2022 value could result in an assessment of $350,000 which would generate potential tax savings of approx. $1500.   Any recent homeowners may want to consult their tax advisors as to whether it makes sense to appeal their tax assessment based on this new information.

The potential concern here is for the taxing bodies.  The services we all depend upon require tax revenues to be funded.  With the potential erosion of tax bases, this new common level ratio will be a victory for new homeowners, but we may all end up paying more in taxes due to the increased millage rates that may be required to compensate for declining tax bases.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Sounds Too Good To Be True

Sounds Too Good To Be True

by | Dec 1, 2022 | Blog, Buyers, Buying Conditions, Contracts, Helpful Tips, Interest Rates, Market Trends, Mortgage, Property Value, Real Estate

WE WOULD LIKE TO BUY A NEW HOME SOON BUT INTEREST RATES SEEM VERY HIGH – WE SEE ADVERTISEMENTS FOR INTERNET LENDERS OFFERING WHAT SEEM TO BE BELOW MARKET RATES.  IS THIS TOO GOOD TO BE TRUE? 

If you were simply refinancing an existing mortgage debt, you MAY be ok choosing an internet lender.  You would just need to be very careful that, before you apply to refinance your loan, you receive from the lender a full disclosure of all the costs and not just the rates.  Often times I see lenders have exorbitantly high fees connected with low rates.  In a sense, you would be buying down your rate by paying high fees upfront.  You would want to be sure to compare them on the same day to a couple of local lenders and understand what you are paying to get the quoted rates.  The reason you must compare rates on a singular date is because rates go up and down continuously and a rate may seem lower simply because you called a particular lender on a date rates dropped.

Since you are buying a new home rather than refinancing, I do NOT recommend that you use an internet lender.  They do not tend to be familiar with area norms and that can cause you more headaches than you can imagine.  There is a long list of particularities to PA Agreements of Sale and the last thing you want to do is have your closing delayed (while your movers are standing at the curb) while you wait for your lender (who does not have a local presence that you can visit personally to address any issues) to sort things out.  As they are not familiar with our Agreements and processes, internet lenders may also impose requirements on you that are not requirements generally imposed by local lenders that may disadvantage you later.  Finally, internet lenders often do not understand that PA Agreements of Sale declare “time is of the essence” inside the contract – what that means to you is that if you miss your closing date because the lender isn’t ready to close, the seller does have the legal right to declare you in default, keep your hand money and sell the home to someone else.

When buying, why take a risk?  Rely on your trusted Realtor to help you find a local lender who offers the most competitively priced loan products and delivers exceptional customer service.  Realtors cannot accept referral fees from lenders, so you can be sure we are motivated only by knowing you will have an outstanding transaction.  Feel free to reach out to me for help finding you the best local lender to meet your financing needs!

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe

Don’t Let the Interest Rates Stop You

Don’t Let the Interest Rates Stop You

by | Nov 4, 2022 | Buyers, Buying Conditions, Contracts, Helpful Tips, Interest Rates, Investment Properties, Listings, Market Trends, Mortgage, Property Value, Real Estate

Interest rates jumped up again. Is it time for us to just wait until spring and hope they start to come back down? 

If you are a buyer, the real estate market offers you a great opportunity right now! Don’t be fooled by the higher interest rates – this is an awesome market for you to buy in! Why? Because all of the people who you would have been competing with are afraid of the interest rates and sitting by the sidelines.  This allows you to have a competition – free opportunity to buy a home!  Just six months ago, buyers would have been overjoyed to have an opportunity to buy a home without competition, to have had an opportunity to have had an offer accepted on the first home they offered on instead of their seventh, to have been able to purchase a home at asking price rather than asking price plus 10 percent!  Do not miss this golden opportunity – there are some very nice homes available right now. You can refinance later with a convenient no cost refinance loan – get the house now! Once rates start to come back down, the buyers (who have all been sitting by the sidelines with you) will come racing back into the market, and bidding wars will be back. Make the smart move – buy now.

And as a side note, I do not feel we will see a “crash” in prices.  Inventory remains at record lows and those homes that are selling continue to increase in their sales prices to new record highs, despite the increasing rates.  This is not 2008 – I am not anticipating any “deals” to be had this spring – if anything the natural increase in the buyer pool we see every spring will boost prices because of the extreme lack of inventory.  Feel free to reach out to me and we can strategize on how you can take the most advantage of the current real estate market while you still can!

A home’s value is set by the market.  Value is always determined by what a buyer is willing to pay for your home.  Many factors come into play in setting that value.  Market value reflects quantitative factors such as:  # bedrooms, # bathrooms, # garages, placement of garages (attached or integral), lot configuration (large and functional back yard?  Cliff lot?), location of the home generally, age of roof, age of mechanicals.  Market value also reflects more qualitative items:  how updated is your home, and is it all new, or just refreshed?  What is the floorplan (open concept?) What are your wall colors?  There is always a range that value will land in, which we call the range of reasonable.  There is no ONE price at which a home will sell.  If there are many buyers seeking a home like yours, it will sell at the top of the range of reasonable.  If there are not, it will take longer to sell and may sell a bit lower in the range.  What the market does not consider in setting a value of a home is what you need from the home.  In 2008, many homeowners had used their homes as ATMs and withdrawn large sums of money for educations, vacations and cars.  When the market softened, there was not enough equity for them to be able to sell their homes and not be in a short sale situation. This fact, that a homeowner over-extended themselves on mortgages, is not the least bit relevant to market value.  The market is also not going to consider what you plan to do next.  If you plan to move to Los Angeles to be closer to family and are finding that the Pittsburgh market is not going to yield you enough to be able to buy in L.A., you will need to turn to other investments to make up any difference.

We are in a very robust market – your home is far more likely to garner more now – whatever that may be – than it could have in the past.   Forecasters are also suggesting that values will soften by year end.  My crystal ball is out for service, but what I can tell you is that every hot market eventually softens.  Waiting out the market so that you can get a price that the market is unprepared to deliver at this time may have you waiting many, many years, and during that time you may need to invest even more in your home in order to deliver to the market what it needs in order to deliver an acceptable sale to you.

Experience Makes

The Difference

If you’re moving across town, from elsewhere in the state, or even relocating
across the country, I can help you find the perfect home! 

Connect With Kathe