We have had this house on the Market on and off for the last two years, with no interest. We started around 799K and are now down to 629K. But, there is a paradox that occurs as one lowers the price and it goes like this. The more that you lower the price, the lower income demographics that you pick up as potential buyers - - - a good thing. But, these lower income persons can not afford the extremely high Rockaway Township real estate taxes, so they preclude themselves as potential buyers. So, in a sense, the more you lower the price, the less desirable the home seems to be because of the relative cost of the property taxes.
Put another way, people do not completely freak out when they are spending 799K on a house that is taxed at roughly 16K per year. But, when you start getting down to a house selling for roughly 600K, these taxes have a huge impact on the buyers.
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On a side note - - - the new McMansion on Meriden Road almost directly across from Clowns Circus has just been reduced again - - - it is now down to 419K. That is really something for a home that was originally priced at 800K two years ago! I suspect it faces the same ratiometric problem with the huge tax bite that we are dealing with.
How does one solve this problem?? You can lower your price down to almost nothing, but one have no control over the downwards incrementally unaffordable tax bite.
That's an interesting situation. I can definitely see how that would happen from a prospective buyer's point of view. Perhaps you should just relax and stay put until we see how the CC situation plays out. I'm wondering if prices would be any lower if CC were definitely going in. At this point I'm pretty sure most buyers will come to learn of the CC possibility if they don't already know about it. I would think any buyers making an offer would factor in a CC-related reduction assuming the worst. That's what I would do anyway. Good luck with your decision.
Most buyers find out about the CC situation and that kills the prospect. We had one interested couple about 1.5 years ago; they loved the place and looked it over three times. But, on the third visit, the "man of the house" took me aside in the back yard and asked me what was going on down the street.
Well, that was the last time we saw them; I probably should have played totally ignorant; as it was, I gave out minimal information.
Anyway, we spoke to the tax assessor via our attorney today. The RT tax assessor says that property values have been on a continual rise here in RT including in the year 2007. How can that be, said our lawyer? Well it is simple:
Any property that sells in RT for less than what the township considers to be the correct price or above that value, is eliminated from the database for statistical calculation. So, that probably means that 90 percent of the home sales are not included in the statistic for calculating the rate of change in RT property values; obvious by definition of you run the stats that way, you are only going to see a rise in values cause you are throwing away all of the real data.
For example, the tax assessor says that this property is worth 790K, even though it has been on the market in the 600K range for a long time. As a matter of fact, the last listing had it at 629K, and we are considering lowering it again. But that does not matter to the assessor. It creates a viscious cycle for us to find an interested buyer; we keep lowering the price, but the tax assessor eliminates houses from the database calculation that sell for less than what he thinks is reasonable. Hey idiot, - the market determines the true value of a home, not you, Mr. tax assessor. And Mr. tax assessor, it was your damn township government that killed property values by approving the largest megachurch on the east coast of the United States to be allowed to locate right here in my backyard.
You are all going to be going through what my wife and I are going through eventually. And, it really sucks. All I can say is - - - Good Luck! RT really does suck the big one.
Its not as doom and gloom as you guys paint it. A house just closed on Old Beach Glenn Rd for $730k and many have sold for good numbers in Meridan estates this past year - one recently for 1.1M
As far as the tax thing goes - Our section of town (Meridan) gets screwed. Go one town over into Denville where a 1M home pays the same taxes as a 600K home in RT.
Sit tight Rat - Wait for the real estate market to turn and this CC dabacle to take its course - its a nice place - enjoy it for a couple of more years - then sell and buy a nice retirement home - outside of NJ of course
Our fear (my wife and I) is that as this cc thing resolves, it is only going to make things much worse around here. Our math says that the jerk is building a circus stadium for a 25,000 person membership. We get at that number from several different angles and we are convinced that it is correct. When that reality really hits home with everyone else in town, this home will not be worth a dime.
And so, we would rather take our lickings today than wait for two years when everyone is looking at a Meadowlands size indoor stadium right here in our back yard.
Without actually seeing your home I cannot make a determination as to what the problem (other than CC) is with it not selling. Keep in mind for the responses to the following questions you need to take a look at what is selling right now in your neighborhood and why. Do you have bright colored walls, off color carpeting, or a combination of the two? What about your landscaping? Do you have pets in the house (dog, cat, hampsters, etc)? Do you have a pool? Two car garage or three? How many bedrooms and how many baths? Finished basement? Any combination of the above could be a factor.
Of course, sometimes instead of simply lowering your price, you might want to consider repainting the interior in neutral tones (white ceiling, light white or cream colored walls), change out some of the off color carpets with neutral tones (again light cream/tan colors), maybe even think about removing some of your furnishings to make the rooms look bigger. Lot's of simple and inexpensive tricks to make your home stand out from the rest of the competition. Landscaping wise you should consult an expert.
Mr Bill
PS: I sold one of our homes in WML recently in less than a month for 20K more than we had expected. Prior to that it had sat on the market for 3 months, a fresh paint job and a new set of carpets in the bedrooms was all it took. All for far less than the 20K more we got for the house as we never dropped the asking price after our initial 5K drop to regain some interest at the 45 day mark.
Gotta throw my 2 cents into this thread too. Like Rat, I am trying to sell, although unlike him, I dont have a veritable McMansion. I was told that in 2005 my house would have brought $450K without any trouble, now we tried $389K for 3 months, nada, $385K for 3 mos., again nada. And yes Mr. Bill we watch all the shows too. Minimal clutter, cleaned up, staged (exquisitly according to all the agents that visited), etc. An addnl. $30K spent over the past year in repairs and upgrades. Right now its on the market FSBO for $380K through the winter to allow us to regroup. Our taxes arent as bad as the big houses in Meridan, we just have a 1800 sq. ft. modest home that we are now paying $7300 per year on. 23 yrs ago when I bought it, although minus a second story addition, the taxes were only $800/yr. and guess what, I dont have one single service now that I didnt have then. That tax assessor thing is very interesting, although I really dont care what RT says their housing market is doing. We all know what is really happening. The other piece of the equation that is killing the entire market is that as each of us lowers our price out of desperation, including all those thousands that were being forclosed on, that lowers the entire market. A buyer then says well why should I pay that for that house, when the house down the block is only going for $x. So then that house reduces, etc, etc, etc. Buyers are in no rush because they see what is happening, but its killing sellers that have any immediacy in their sale. All predictions say that the decline will continue thru 2008, then it might stabilize. It will not rebound, just stop declining. Until then we loose 2% per month in value. Although a problem nationwide, NJ including RT is causing a max exodus from the state. We want to go to SC, where we can buy a house twice as large, with several acres of property and a pool and only pay taxes of $1600 per year. Like they say, will the last person to leave NJ please turn off the lights.
All of the right things have been done here at this home. It is immaculate, with all oak wood floors, off-white paint, stained oak and clear pine wood trim throughout, solid stained wood doors, ceramic tile, etc, etc, etc. It is a home made with the highest quality materials and its infrastructure are in exceptional shape. The pros (4 different real estate companies were consulted) determined what this place should be listed for, and it has not sold over the last 1.5 year period of time. In short, this is a dream house for many folks, but a nightmare when folks consider the environment that it will be surrounded by. In short, it has but one huge problem; it is located in RT. There are three subset problems with that:
1. CC is here to stay and the buyers know it and do not want any part of it. Would you spend your hard earned money on a place located near this circus? I think not. 2. The property taxes are the highest in the county, and why? (see point # 3) 3. The school system is terrible compared to other towns in Morris county with lower taxes.
We have been heavily involved in the lowering of the price to make the home more attractive since we can not IMPACT items 1, 2 and/or 3.
So, - - - ??? All that we know is that we do not want to live here and want to get out of here asap and will do whatever it takes to do so. We may have to dig deeply into our savings to make up the financial loss that we shall incur, but we will do that to solve the problem for ourselves. We will not tolerate living in an inner City - Country (CC) environment. We are not in need of Prisoner Reform Ministries, Drug Rehab Ministries, Sunday Rock concerts or any of that crap. We just want to keep that depravity as far away from our lives as possible. Both my wife and I know what it is like to live in the inner city (Newark), and so we know that experience first hand. You will get to share that experience with us when things come to fruition here on GPR.
I should have been more clear on what impact that has on everyone. You see, when the township performs a statistical calculation on the selling prices of homes and throws out 90 percent of the data as "outliers", then it will appear like housing prices increased 5 or 6 percent when in fact they decreased in value by more than that value. So what, you are thinking. Well, that increase gives the township the rationale that they want to increase taxes by that amount because of these falsely calculated increased housing values.
That is the big gotcha. And, this sort of "fuzzy math" effects everyones tax bill in the township. Should you be outraged by it? You are damm right you should be because the calculations are based on a fundamental lie.
