Monday, May 21, 2012

The tax digest did not grow, despite what you may read.

Post by Mike Flynn

A completely clueless report!

What is missing in the above report is the reality of our current situation. The reporter states that the digest has grown. That is what Denver Hooten said, so he reported it.

The truth of the matter is the value of the digest has been inflated, and since property values are in decline, many owners will be appealing for write downs.

How much over valued is the digest? Well lets look at one specific property to give you an idea.

710 Van Buren is a multi-family unit currently on the market for $29,000. It has five apartments that can be rented for a gross of $870 per month. The property is in distressed condition and has been on the market for 761 days.

Now let's examine how that property is reported on the digest. The property is identified as parcel 0000D/00010/032 and is carried on the digest at a value of $107,900 dollars.

So who is right? For a period of 761 days the free market has rejected this property at a value of $29,000, but lets give them that value just to make a point.

The digest value of $107,900 minus the market value of $29,000 gives us an over valuation by the county of $78,900. 710 Van Buren is over valued by 372%.

This is an extreme example, but there are others. Many others. 

1 comment:

  1. A close look at the digest will show a "slug" of the growth is subsidized housing units coming on line. A small increase in taxable value, a giant increase in poverty potential, In these cases, the demand for services by the tenants far outstrips the amount of tax revenue generated--a losing situation is the end result.