Property values in Davis Sq (and Somerville)

[nvidia99999.livejournal.com]

I just saw in the Somerville News an estimate saying that property values in Somerville declined 2% this year:
http://www.thesomervillenews.com/main.asp?SectionID=2&SubSectionID=2&ArticleID=218. Somebody mentioned that Zillow actually reports a loss of about 8%. This is confusing. The Editor of the Somerville News pointed out that Zillow does not have accurate estimates. In my experience, Zillow is pretty on the mark when it comes to sale prices, they seem to be doing lots of good stats on their datasets. Any idea on how to gather additional information on this? I doubt one can trust the Somerville News, given that it was created by the owners of ERA, one of the Somerville Real Estate agencies (clearly, they would not want to advertise that property values are going down around here).

One funny tidbit. Have you received a pack of coupon last week? I received one, and one of the coupons was an ad for ERA, the Norton Group. It says: "Voted #1 Real Estate Company 2000 to 2007 By the readers of the Somerville News"! Now, when many of the readers are ERA employees or relatives of ERA employees, that is a bit of a conflict of interest, isn't it? :)

Comments

[laryu.livejournal.com]

The Somerville News attributed the figure to the city assessors, so as far as setting the tax rate, that's the only important figure.

The Warren Group, who publish Banker & Tradesman, is the most authoritative source for Mass home sales data. I just checked their figures and they show about a 6% decline on all sales through October. The number is -13% for single-family homes and -2% for condos.

Of course, sales data do not necessarily reflect the overall change to the tax base, unless you assume that one year's sales are perfectly representative of the overall housing stock. This could explain the discrepancy between sales figures and the city assessor's figures.

In my experience, Zillow has been a random-number generator. Way too much GIGO.

Not sure I understand.

[nvidia99999.livejournal.com]

When you say that number is a 6% decline on all sales, do you mean that the average price is down 6% or that 6% fewer units were sold (compared to 1 YR ago). Regarding Zillow, I have a few friends on the West Coast who sold their places a few months ago, and they got almost exactly what Zillow had predicted. I don't know if there are any objective numbers on how well it does, though...

thanks laryu

[jamesnorton.livejournal.com]

when setting the tax rate - only data from the city assessors is important

as far as getting a wider snapshot of the actual real estate market and its imperfect representation to those who cannot begin to understand the complexities of it - the warren group (the standard for accurate real estate data) - is the most accurate information source available today in the boston area

zillow is one of the worst data sources i have ever seen in this business - in this market - and i have been doing this a very long time and analyze data relative to this industry on a constant basis today

the more frightening aspect of the original post of this thread is the subtle inference that actual news stories in the newspaper have ever even once been influenced by the owners of the newspaper - that's another laughable and completely arrogant misconception

[cos]

I think house prices can be *very* localized. I bought my place in Central Square a few months ago for exactly the same price as my friend paid for it in June 2006, which in theory was around the top of the housing price bubble... yet my assessor assessed this place as being worth more than I paid for it. It could just be that she got a really good deal, except that a similar unit in the same 3-family sold in 2007, for a comparable price. Just think that within a couple of blocks of Central Square, housing prices have stayed stable. I wouldn't be surprised if the same holds true for Davis. For example, I think volatile gas prices tend to push housing value away from places where people commute by car, and towards T stops, so Davis/Porter might've absorbed some housing value that, say, east Somerville might've lost.

[rmd.livejournal.com]

huh. when i was tracking real estate prices more closely, a year and a half ago or so, zillow was crack-smokingly optimistic in its estimates. maybe they've gotten more accurate.

wow what a misinformed person

[jamesnorton.livejournal.com]

zillow is notoriously flawed in its data, i was absolutely correct in making that statement over at the somerville news website...

the somerville news wasnt created by the owners of era - it was created in 1969 - and not for nothing, but if property sales prices came down, that would eventually translate into more sales, actually, so it doesnt makes a lot of sense saying the real estate people wouldnt want to advertise lower prices

the somerville news best of series was around long before era was associated with the newspaper - check it out, its easy to find out the right information on that

wow it amazes me that people can be that misinformed, and then make snide commentary based on said misinformation...why dont you take the time to actually find out what you are making snide comments about before you make them? is it really that hard? do you really hate people for no particular reason? at least i have a valid reason when i say i cant stand snotty, arrogant asshats that don't have a clue.

Re: wow what a misinformed person

[prunesnprisms.livejournal.com]

That's a really pleasant attitude to take over anyone that disagrees with you. You've cheered my morning.

Re: wow what a misinformed person

[koloratur.livejournal.com]

"why dont you take the time to actually find out what you are making snide comments about before you make them? is it really that hard? do you really hate people for no particular reason? at least i have a valid reason when i say i cant stand snotty, arrogant asshats that don't have a clue."

Right back atcha.

Re: wow what a misinformed person

[maelithil.livejournal.com]

You are ensuring that I will never even go near the Somerville News. Cheers!

Re: wow what a misinformed person

[kpht.livejournal.com]

Again, your classiness shines every time you end up posting here. Even a five year old learns to stop embarrassing himself the same way after the second or third time he does something.

Re: wow what a misinformed person

[pierceheart.livejournal.com]

at least i have a valid reason when i say i cant stand snotty, arrogant asshats

As do we all, now.

reading comprehension doesn't seem to be your strong point

[pierceheart.livejournal.com]

the somerville news wasnt created by the owners of era

Not for nothing, no one said it was.

the somerville news best of series was around long before era was associated with the newspaper - check it out, its easy to find out the right information on that

Again, no one said the ERA link predated anything.

what was said was:

One funny tidbit. Have you received a pack of coupon last week? I received one, and one of the coupons was an ad for ERA, the Norton Group. It says: "Voted #1 Real Estate Company 2000 to 2007 By the readers of the Somerville News"! Now, when many of the readers are ERA employees or relatives of ERA employees, that is a bit of a conflict of interest, isn't it? :)

Re: wow what a misinformed person

[pierceheart.livejournal.com]

I'd delete my comments, but I know the mods disapprove of that, so, my apologies for calling you on reading comprehension, when I clearly didn't see something that was clearly there.

[cold-type.livejournal.com]

Two things re: assessment values.

1) The new assessment is based on values as of Jan. 1, 2008, compared to Jan. 1, 2007. So the 2 percent change supposedly represents the change in property values during 2007 -- not this year. (The assessments are always a year behind.)

2) Are assessments more reliable than zillow? I don't really know. But when I look at home sales, I've noticed the numbers often differ substantially from assessments. Has anyone else noticed that? If you bought or sold a home in the past few years, was the assessment on the mark?

[jamesnorton.livejournal.com]

actually, no, if what i typed read that i was trying to imply that assessments were reliable with respect to the market, then that isn't correct. when determining taxes, assessments are the benchmark - that's all. assessments with respect to real world valuation (the market) are notoriously flawed for a number of reasons which would take hours to explain.

when it comes to the marketplace in the boston (all of new england actually) zillow is notoriously flawed...it's hard to pinpoint why, esp given the fact that it is true, zillow has been very much on target in a city like san francisco.

i took offense to the person making the snide comments - nothing that could have been considered a "disagreement" as far as opinions or statements of fact...

[narya.livejournal.com]

If you (say) renovate an old 2-family that's in disrepair into two shiny new condos, the assessment would presumably not catch up until the next year. So in cases like that I would expect the assessment to be pretty different from the sale price at the time of sale.

[narya.livejournal.com]

With respect to Zillow, I've found its prices for Somerville to be unreliable for a couple of reasons:

1) It isn't really very good about factoring in proximity to public transportation. Being a five minute walk from the red line vs a 25 minute walk is a big difference for buyers, but looking at Zillow's comparables it doesn't seem to account for them very well.

2) It doesn't account very well for the level of supply in the market - typically there are a lot more condos available around here than single family homes, which is a little bit unusual.

3) People can edit the features of their property in Zillow and I did notice people adding questionable features the last time I was looking for property. I saw things like listing both a dining room and an extra bedroom that were really the same room, including A/C when they had window units rather than central air, etc.

If what you're looking at is the median price, I don't think it's going to tell you a lot. As the market slowed down, fewer new renovations and such will be available on the market, so the median price may move down much more than the price on any "average" unit moves down.

The article is talking about the assessed values, which will tend to change somewhat less than the market values. The statement that the assessed values declined by 2% is a statement of fact, quoted from the assessors, and you could presumably verify it by calling the assessor's office and asking them for yourself. But it's important to keep in mind that the assessed price is not necessarily the market price. Any particular property can potentially sell for significantly more or less than its assessed value.

zillow manillow

[jamesnorton.livejournal.com]

good points narya -

when i was pissy at 315am this morning about the remarks thrown my way, it wasn't in me to list out some of the issues with zillow - but you did a fabulous job! it isn't just somerville that zillow is horribly flawed, but pretty much the entire area - more flawed as you go closer to the downtown area of boston and less as you travel outwards in a concentric fashion.

i have found only one example where tax assessments have gone along hand in hand with the marketplace - and that would be commercial property assessments in cambridge, especially on larger residential-based properties (5 or more units) and industrial complexes (small to medium/large).

also of note, the MLS-Pin system most realtors use is flawed as well - for a long list of reasons not worth getting into, but predominately because of the realtors themselves (sloppy/incorrect data entry, no independent verification, etc.). the real estate market, overall, is a difficult thing to really understand - we are lucky in somerville for the most part, because things aren't as bad here as they are in say, Stoneham or Lynn or Brockton or even Waltham/Watertown - and there are a whole host of reasons for that as well...
ad valorem taxation is a funny little beast - assessments go up, the mill rate goes down and vice-versa - it's a political shell game so that the typical homeowner doesn't groan too much that their taxes are almost always going up...which from a governmental perspective is vital to meet the requirements of the community as far as essential services.

ok too many subjects, requiring way too much information to be of use here...

[ron_newman]

Also, from yesterday's Globe article:

"Assessments, calculated largely off the previous calendar year's sales, lag the market. As a result, the average assessed value for homes is likely to dip again this year - as it has for many of the communities whose figures have recently been certified - and could do so next year as well."

[ritcey.livejournal.com]

The coupon reads it was "voted" #1, scare quotes included. Apparently, there wasn't an actual vote, so no problem there ;-)

http://quotation-marks.blogspot.com/2008/11/there-was-no-vote.html

[cos]

Oooh I love that blog! How did I never notice it before? Thanks!

[kpht.livejournal.com]

george w: "voted" our next president in 2000.

Wow! Somebody actually scanned the coupon!

[nvidia99999.livejournal.com]

I'm glad I was not the only one to find that funny.

Zillow

[laryu.livejournal.com]

fwiw, zillow reports its Somerville "Zindex" is -2.9% year-over-year for the 3rd quarter of 2008.

Re: Zillow

[masswich.livejournal.com]

As someone who watches prices pretty closely, I don't think Zillow does such a bad job, for what it is. Of course, every house has specifics that require adjustments to the base number. That's why appraisers aren't losing their jobs to Zillow.

[icecreamempress.livejournal.com]

In general, newspapers that run a "Best of" contest or poll usually take any businesses owned by the newspaper's controlling partners out of the running to avoid the appearance of a conflict of interest.

I'd recommend that the Somerville News think about following that model in future.

[ron_newman]

But then who would win "Best Tow Company" ?