Debated Advantages And Disadvantages Of Making An Early Reval Local news

CONWAY – Chief Executive Officer Tom Holmes last week asked elected officials to consider funding a reassessment next year, the cost of which would be in the proposed operating budget for 2022. The state is imposing reassessments every five years and the previous one has just been done in 2019.

However, real estate has appreciated so quickly that some properties, mobile homes, now sell for twice their appraised value on average. Other properties have increased at different rates.

An appraiser the city contracts with recommends doing an appraisal before 2024 if selling prices continue to rise. But the head of the White Mountain Board of Realtors fears it could do a huge disservice to single-family homeowners, who would see their property taxes skyrocket.

Meanwhile, the city is battling short-term rental landlords in court over the meaning of Conway’s zoning ordinance and whether to allow short-term unoccupied rentals in residential areas. The outcome of the city lawsuit could also affect property values ​​in unexpected ways.

The city does not currently have its own appraiser and has contracted with Marybeth Walker of Corcoran Consulting Associates in Wolfeboro to do its appraisal work.

Walker updated the selectmen on Tuesday on property values ​​and the pros and cons of a reassessment, providing the board of directors with a “preliminary ratio report” in their backgrounder.

The median ratio of all goods is 67.8%. This means that median estimated values, based on sales, are about 68% of what they sell for, but different types of properties all have different percentages.

“We value different types of properties against the market at different rates,” Walker said. “So the primary goal of a revaluation would be to achieve as close as possible to 100% of market value.”

The ratio of manufactured homes without land is 49.4 percent on the median. Single-family homes are at 64.7% and land and commercial buildings at 78%.

Walker’s report says if market trends continue until next June, she would recommend updating valued values ​​before 2024, when the city is legally obligated to reassess.

“So the longer you wait to see what happens, you might put yourself in a position where you’re doubling someone’s rating instead of increasing it in small increments,” Walker said. “The market might turn around. I don’t know.”

Selectman Mary Carey Seavey expressed concern that a reassessment would be premature given the court case.

“I’m not comfortable with this until we see how the short-term rental (case) turns out,” Seavey said. “It’s going to play a major role if they’re going to keep going up or down a lot. I’m concerned about this big, big lawsuit and I’m also concerned that we’re moving too fast to reassess right now. “

Selectman Carl Thibodeau asked Walker what the connection was between short-term rentals and property values.

“What was presented to me is that if you win your case, there will be an influx of properties that will come to market all at once,” Walker said. “So it may bring values ​​down. That’s what I’ve been told. I don’t know if this will happen or not. We haven’t seen it yet. You’ve been discussing this for quite some time. It can happen.”

The Selectmen have about two weeks to decide whether they want to come up with a reval or not.

Before Seavey made his remarks, Selectmen Steve Porter, who is the selectmen’s representative on the planning board, said it had been a “one-off year” where buyers were buying homes at high prices, possibly to escape. to the pandemic.

“They pay ridiculous money for housing in most normal times, I don’t think you would see it,” Porter said, adding, “I see it’s slowing down a bit in terms of buying homes.” .

According to the New Hampshire Association of Realtors, the median home sale in Conway in mid-November was around $ 369,000 for 2021, a 31% increase from 2020.

The Sun has reached out to White Mountain Realtor Board Chairman Paul Mayer for comment on making a revival next year.

“Selectman Steve Porter is correct that the incredible increase in house prices is mainly due to the COVID pandemic,” Mayer said.

“Spending additional funds in the budget to do an early assessment would place a higher tax burden on single-family homes and lower taxes on commercial properties, as homes saw the biggest increase during the pandemic,” he said. he adds.

“Based on the current deviation from fair market value, homes would be valued at around 36% and above, while commercial properties would only see an increase of 22% and above. That would represent a huge increase in the average bill for owner Conway as they would be paying a larger share than what they are currently paying, ”Mayer explained.

The Mount Washington Valley Association for Responsible Vacation Rentals, a group of STR owners and supporters, recently hired Daniel Innis, professor of hotel management and marketing at the Paul College of Business and Economics at UNH, to study the effect. short term rentals in town.

In terms of house prices in Conway, Innis said two factors are much more important than STRs: the unemployment rate – the lower it is, the more prices rise; and out-of-state buyers who would likely occupy half of the newly available housing stock if short-term home rentals were prohibited.

“So the main price driver for Conway is absolutely not Airbnb, but Massachusetts, New York and other places,” Innis said, adding that wealthy shoppers in those areas would think it’s a good deal. to buy a four bedroom house for $ 500,000 in Conway. “They come up with a completely ridiculous price perspective.”

The president of the Mt. Washington Valley Association for Responsible Vacation Rentals, David Cavanaugh, told The Sun his group “would have no position on when the city would re-evaluate.

“However, we do know that the number of short-term rentals in Conway is less than 7 percent of the housing stock. The UNH Economic Impact report on Conway indicated that the effect of STRs on house prices was only 0.01 to 0.03 percent. If the second home owners who practice short-term rentals were motivated to sell, the effect would be minimal in the current seller’s market. In addition, the declaratory judgment (of the court) does not end the legal issues surrounding the ban on short-term rental at Conway. “

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