Challenging Your Tax Assessment

Hello,

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I often get asked about taxes, how does one go about lowering them in Northampton and Lehigh County.

**Please note that all of the following advice is by no means anything more than an opinion based off of my observations. Be advised it is wise to talk to a tax professional, also a Lawyer, to look at the scope of your Real Property situation. This post is more anecdotal to give the consumer an idea of what questions to ask upon meeting with a professional.

First- Your own assessment

The tax assessment of one's home, or any other type of Real Property, is the most important number in the process of refuting taxes. If one buys a home for $200,000 and the assessment is for $300,000, then from a preliminary glance; it would seem a tax reduction should occur. Typically, tax reductions are not directly proportional to sales price. Assessed values are subjective, and when homeowner's challenge their taxes, they are challenging the methodology of the county's tax assessment. This puts the burden of proof on the county.

Northampton County's tax re-assessment was done in 1995

Lehigh County's tax re-assessment  was done in 2012

Second- Your neighbors assessment and when one can challenge their taxes

Upon the purchase of a home is not the only obvious time a person should, and can, analyze their tax assessment. If a neighbor buys a similar home, for less than another neighbor's assessed value, then the latter neighbor might have a case to reduce his taxes . In Northampton and Lehigh County, a person can challenge his taxes once a year. Please call the tax office to find out more details, a person is welcome to represent themselves while challenging their taxes in front of the tax board.

Third-- When it makes sense to contact a Realtor

I have suggested that it makes sense to challenge one's taxes if  a sale price (or Market Value) of Real Property is below an assessment value. If in a local area, homes are consistently selling for less than the assessed value; then getting the public documents stating so, helps a lot. A Realtor can assist in getting these comparables, the more recent the better. Asking a Realtor to do a free Comparative Market Analysis (CMA) may be advantageous.

Fourth- Dynamics further explained

If possible, look for Real Property that is as similar as possible to one's own property. This includes bedrooms, bathrooms, acreage, topography, zoning, present us, sewer, water, construction and anything else.

Fifth- Examples that may or may not reduce taxes

It is widely known that Dryvit Stucco had installation issues when it started to become prevalent in the early nineties. I have not seen it argued in front of a tax review; however, this is something that could, and in my opinion, should affect value. Tax assessments are not scientific, so putting the burden of proof on the tax review board should be the objective of the board.

If you want to discuss this with me, please, get in touch

Stephen

stephen.weinstein@foxroach.com
484-393-2305

January 2014 Market Update

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Market Reports: I love talking about Market Reports. I have a few below that I find helpful.



1. Zillow November 2014 Review

According to Zillow, Negative equity is continually decreasing, this is evident by more sellers selling while median price year over year has not increased as much as the national average. Lehigh and Northampton Counties are lagging the national average in regard to price accretion. It is my opinion, that as negative equity continues to decrease, this back log of supply will stymie and prices will increase. Forks Township had a great year by increasing 7% in annual median price.



2. Bank Owned vs Non-bank Owned properties:

To reiterate, according to the Zillow report the, Lehigh Valley has lagged the national average. So why is this? I believe the supply of bank owned properties has a lot to do with median being static. When there is a "shadow inventory" of bank owned properties, this means the banks have a lot of homes going through the short sale and foreclosure process. They do not release all of these properties to the market at the same time as it would hurt the collective value of their portfolio of assets.

However, if prices remain static, which they have in the Lehigh Valley, the stream of foreclosures remains steady, holding back the overall median price of the market. According to this chart, the supply is dissipating, especially compared to Jan 13  to Jan 14.


3. Federal Housing Finance Agency


I keep this report for reference from month to month: The FHFA is a pretty cool index because it only pertains to mortgage resale's where the mortgages are owned by FHFA, Freddie, and Fannie. The reason that its a different kind of index is it differentiates between cash buyers and buyer's using investor financing. Its also nice because it does a good job of comparing different metro's. The link I provided compares Philadelphia, Pittsburgh and the Lehigh Valley.


4. Here is a BHHS Fox and Roach's


Northampton County

Lehigh County


I think the video reporter does a pretty good job of taking a few metrics and succinctly giving their meaning.