We have heard a number of theories as to why buyers are active so early in the year. One is that the lack of snow has everyone acting like it’s spring. Another line of thinking is that buyers who had their search derailed by the Halloween snow storm and subsequent power outage regrouped after New Year’s weekend and resumed their search. Finally others believe that the activity level is up due to favorable buying conditions. The truth is most likely a combination of these, and other, factors. But the end result is a quick start to the year.

There are a few main factors that play into the favorable buying conditions that we should note:

1. Mortgage rates are very low with 30-year fixed loans often having interest rates below 4%. The government announced that they plan to keep short-term rates at current levels for years, so it is possible mortgage rates may also remain quite low for an extended period.

2. Prices have fallen back to the levels of the early 2000s, making homes much more affordable than they were near the peak in 2006/2007.

3. Buyer confidence has increased to the point where people seem comfortable with the idea of either becoming homeowners or moving up to a larger property. This is partially a reflection of the local business environment where we see companies more inclined to hire workers than lay them off. There also appears to be more people relocating to the Hartford area for jobs than there has been over the past few years.

We’re expecting a busy spring real estate market in 2012 and already see activity picking up. Sellers should feel comfortable listing their homes at any point in the next few months, as buyers are already out there bidding. Buyers need to realize that they will have competition for the most desirable homes and plan their bidding strategies accordingly.

Thanks to Kerri Provost from the Real Hartford blog for providing this inspiring story.

Though not very long, the steep embankment always draws a crowd in fresh snow and makes for an exciting run. There is even an opportunity for a jump at the bottom of the hill when crossing over the gravel path that circles this portion of the park.

I hope you had enjoyable holidays. Based on the number of parties you attended and all of the comings and goings I saw and heard about, it seems that you were festive and merry. Good for you.

Recently I’ve been listening to you banter back and forth about potential New Year’s resolutions for 2012. Lose some weight. Read more. Spend less time watching TV. You know, the kinds of things that all humans consider as worthwhile endeavors at the beginning of every year, only to quit them within a few weeks.

Well, as you know, I just turned 100 years old in 2011. I thought it might be a good idea to come up with my own resolutions for 2012, seeing as I’m heading into my next century of being and all. I haven’t really had resolutions in the past, but I see this as good of a time as any to start. Since I’m a house and don’t really have income or moveable limbs in order to help myself, you’re going to need to assist me with these items. I figure it’s the least you can do since you live within my walls and keep me busy on a daily basis. In no particular order, here’s what I’d like to work on for 2012:

1. Be less dusty. I know you have a kid and a Labrador, but maybe this can be a mutual goal. Dust me more and you can lose some weight?

2. Have fewer weeds in my garden beds. Again, seems like a mutual goal. You lose more weight, I keep my self respect with the neighboring properties.

3. Get some insulation. Kyle keeps the heat really low and I’m freezing my bum off. If you can swing it, I would also appreciate a new furnace and hot water heater. I’ve been doing some research for you which I can pass along if you’d like…

4. Watch less HGTV. Honestly, I’m getting a complex by listening to the whiney people on TV talk about new homes with open floor plans, granite counters and remodeled bathrooms. Why aren’t old houses ever good enough?

These seem simple enough, if you ask me. I consider these goals the least you can do given all that I do for you. So raise your dust rags and weeding implements, here’s to a happy and successful 2012!

Warm regards,
Your House

The Courant is projecting that the three property classes will have assessment ratios of 70% for commercial, 50% for apartments (which now includes four-family buildings) and 30.6% for residential (condos, single-families, two-families and three-families). They expect the mill rate to be somewhere between 76 and 77, and used 76.79 in their calculations.

Hartford property owners interested in estimating what their July 2012 property taxes based on this model can use the following formula:

So for a residential property this comes out to be…

… which is about the same as …

Owners of commercial and apartment properties would need to start with the first formula and plug in the appropriate assessment ratio.

Since we are still in the early stages of the revaluation process, this is a rough estimate and a lot can still change before tax bills go out at the end of June of next year.

Thoughts & Observations

The most challenging part of modeling the Hartford tax system is getting the residential assessment ratio correct. For the coming year it is supposed to be set so that the overall tax burden of residential property class increases by 3.5%. That was a compromise agreed to by the various stakeholders last spring and passed into law by the state legislature. The primary article attributes the 30ish percent assessment ratio to City Assessor John Philip, and lead author Jenna Carlesso confirmed that he provided that number.

The Courant is forecasting that the mill rate will actually increase under the new system. This is a bit of a surprise since the City’s overall goal is to start reducing the mill rate in order to help attract more businesses.

Although it seems counter-intuitive, it’s okay if the mill rate rises. The data clearly shows that the tax burdens for commercial property owners is decreasing, which is more important than the perception caused by the slightly higher mill rate. In the previous system we had an additional layer of complexity called the Business Surcharge – an additional tax over and above the standard tax – that is now gone. The City has taken an important first step to making the commercial mill rate directly comparable to other towns in the state.

Since the City Assessor has not come out with an official set of projections, we think it is important to continue to develop our own model on what could happen. We’ll keep trying to get data from the Assessor and hopefully have a second set of projections to share in the coming weeks.

Presumably the Courant team succeeded in getting additional information from Assessor Philip as inputs to their model. In thinking about repeating the calculation on our own, we don’t see any way to accurately do it without knowing the aggregate market values for each property class for both last year and this year. Last spring the previous City Assessor provided us a good amount of information, but not the breakdown of the residential class. Since the rules of the game changed to move four-families from the residential assessment bucket to the apartment bucket, we would need to calculate the impact of that change before being able to distribute the tax burden correctly and arrive at a potential mill rate.

Using the Courant’s Data to Calculate Their Projected Mill Rate

For those that are curious, here’s how we used the data that the Courant published to back into the mill rate and residential assessment ratio they are projecting.

After inputting all the data into a spreadsheet, we focused on the commercial and apartment properties. We knew the assessment ratios, so we were able to calculate the assumed mill rate. Once we knew the mill rate, we were able to use that in the residential properties to calculate the assessment ratio. Fortunately the values were consistent across all 9 properties once rounding errors were considered.

Here is our table, the cells with blue text are inputs while the cells with black text are calculations.

Related Posts
Hartford’s Revaluation 2011 – Update
Overview of Hartford’s Property Tax System

Proposed Fair Market Value

The first important point to make is that the numbers sent by the City have no immediate impact on our property taxes. They are an important milestone in the revaluation process that will show up in our July 2012 tax bills.

The values in the letter are also market values rather than assessed values. So the number you received is the value at which the City believes your home would sell in the open market. The value on which our homes are actually taxed is a much lower number, the assessment, which over the past few years has been less than 30% of the market value assigned in 2006. We do have an opportunity to challenge the new market values, if we feel they are unfair, which will be discussed below.

Over the next few months the City will finalize the market values for all the properties in the City in order to create the 2012 Grand List. Homeowners that do challenge their market values, and are not happy with that outcome, can appeal the initial result to the Board of Assessment Appeals. Please see your letter, and the City website, for more information.

Determining the assessment ratio for the residential property class is the next challenge for the Assessor. The letter notes that it will be established by the end of January, though it will depend on the Grand List, so a final number probably won’t be available until all market value appeals have been completed. Hopefully the January number will be a good estimate based on a mostly complete Grand List. Multiplying our market values by the assessment ratio of residential property will give the assessed value on which we’ll pay our taxes.

In May, the City Council will review the City budget. They will back into the mill rate needed to fund the budget based on the assessed values of all the properties in town. And in July we’ll receive our new tax bills that reflect the results of Revaluation 2011.

Immediate Action

Over the next few weeks the market values are still open for discussion. Homeowners who want to challenge their values, or at least get an explanation, need to set up an appointment. The “informal hearing” appointments are held with the CLT Division of Tyler Technologies, who can be reached weekdays from 8:30 to 4:30 at 877-394-3379. Appointments must be requested by December 15th.

Homeowners choosing to discuss their values are expected to bring data and evidence to support their position. The letter we all received notes that “a change in value will be considered if the owner is able to demonstrate that the appraised value is in excess of market value.”

The primary source of market value data is the sales records that are kept Downtown in City Hall. Specific properties can be researched using the “On-Line Data” link in the right column of the Hartford Assessor page. The Assessor’s office intends to publish the Proposed Fair Market Values of all properties on this site so that owners have an easy way to perform their research.

Real estate agents are another source of market value information. We successfully challenged our market value in 2006, and are happy to help homeowners make a case for the lower valuation.

Initial Observations

We have heard from a number of Hartford homeowners already, and the clear consensus is that assigned market values have fallen from the Revaluation 2006 numbers. That’s to be expected, as the actual market values in the neighborhood have fallen.

Values of the individual homes do seem to deviate from what we feel are their actual values. Some owners have surprisingly low values, while others are a little too high for the current environment.

More interesting is the big picture. Hartford has three assessment buckets that each have their own assessment ratios: residential, apartment, and commercial. The State legislature passed a bill in June that set the assessment ratios for the coming tax year at 50% for apartments and 70% for commercial. The residential assessment rate was capped such that homeowners would be responsible for no more than an additional 3.5% of the tax burden due to the revaluation. At the same time, the assessment ratio for residential has a floor of 23%.

Under the new system, apartment buildings will definitely have higher property taxes. That assessment class was expanded to include 4 family buildings, and the assessment ratio was increased from about 37.6% to 50%. Commercial buildings will continue to be assessed at 70%, but will no longer have an additional surcharge on top of that.

The wildcard in the whole process is how much commercial values fell compared to residential values. That will drive the residential assessment ratio, and play a big role in determining where the mill rate needs to be set in order to fund the budget.

The Courant’s Ken Gosselin published a story over the weekend which noted that the Assessor has not yet analyzed the impact of proposed fair market values on the different property classes. We have been in touch with the Assessor’s office too, asking for both their projections on the residential assessment ratio and likely mill rate. We have also requested the big picture market value data so that we can do our own analysis. Please keep an eye on this site in the coming weeks; we will publish additional information and findings as they are available.

In the meantime, take a second look at the letter you received from the City about your property’s proposed fair market value. If you are concerned that it might be too high, then it is in your best interest to look into the matter further — and we are happy to help if needed.

Related Posts
Overview of Hartford’s Property Tax System

Do you buy in to decorating your home for the seasons or holidays? Some of us pick and choose which seasons to dress up our homes, while others use any excuse they can get to display a new wreath, flag or some type of bric-a-brac to celebrate each passing holiday and season.

I enjoy looking at peoples’ exterior seasonal decorations. Everyone has different styles and often you’ll see clever creations. I find that we don’t do much exterior decorating at our house though. In the spring we’ll put some planters on our front and side porches that will last through the summer. Low maintenance, but offering some color and cheer. Nothing happens on the outside of our house during the fall because of our battle with the squirrels. No pumpkins, no ghosts, nothing. Bah-humbug!

The winter/Christmas season seems to be the time when people go through the most effort to showcase the exterior of their homes. We spend a lot of effort decorating the inside of our home, but for the outside go with two simple wreaths that stay up until at least April. Not because they’re seasonally appropriate, but because we’re lazy.

Many of our neighbors, and maybe yours, or even you (!) tend to go all Clark Griswold on their places. Driving around residential areas in the evenings is always a fun activity. Who has the inflatable winter wonderlands? Who goes for twinkly lights only? Our daughter, who is two, really enjoys this and exclaims “Christmas!” every time she sees lights.

Do you put a lot of effort into seasonally decorating the exterior of your home? Why do you do so? Because you enjoy it? Family tradition? Keeping up with the Joneses?

NOTE: The house pictured above is one of my very favorites in the West End of Hartford. The owner of this home does a remarkable job every season. Everything they do is tasteful and visually interesting. If you get a chance, do a drive through some evening and see if you can find it. It also looks very nice during the day.

I see a lot of structures from the 1890s through the present day. The housing stock in Greater Hartford has been gradually built up through the years, with different towns and neighborhoods developed in different eras. Each period has design characteristics that reflect the priorities of the times. My favorite era was around the turn of the century when single family homes had evolved into basically their modern form, yet still had a lot of interesting, and custom, features.

At the top of my list of favorite interior architectural details are transom windows, which are windows over doors. Some still even work, with the mechanisms in place that can open and close the windows. They are not all that common, but I sometimes see them in homes built around 1900 – generally in properties in the West End of Hartford. The brief Wikipedia page for transom windows notes that they were “a common feature in office buildings and apartments before air conditioning became common.” The idea being that it’s a good way to encourage air circulation in a building while maintaining a certain amount of privacy.

Another favorite are pocket doors, which slide into the walls when they’re not in use. The fact that they’re hidden is part of their charm – it’s a nice surprise when they get pulled out. And when they are closed, pocket doors are usually in great shape, since homeowners rarely use them. More often than not they match the style and finish of the normal sized doors in the home.

Finally, I really like built-in cabinetry. Most of the time it takes the form of shelving in the living room, china cabinets in the dining room, and the butler’s pantry. Built-ins are usually more practical than dazzling, but I appreciate how the architects and builders made an effort to thoughtfully utilize all the space in a home. They’re functional, and they help define how the different spaces might be used.

Transom windows, pocket doors, and built-in cabinetry are just a few of the interior architectural elements available in Greater Hartford. They happen to be some of my favorites, but not the only things about a home that make it shine.

What interior architectural features do you look for in a home?

I’m happy to report that I’ve made good progress on my goal. Most importantly, I’ve eliminated some of the physical and mental barriers that I felt were keeping me from truly embracing the bike. The most important turned out to be finding a more convenient place to store my ride so that it’s easy to just get started. A close second was figuring out a way to secure my pant legs so that they would be less likely to get greasy. Beyond that, most of my concerns were mental issues.

Since the initial post I’ve ridden many places, and to different types of appointments. Most have been short jaunts where biking is just as fast as driving, but there have been a few longer ones too. I still believe biking is better for trips that don’t involve client interaction, but I’m beginning to come around on that front too. Especially since, as a couple commenters pointed out, biking gets easier as you get in better shape.

I’m hoping to keep riding as long as possible this season because it is a nice way to travel. I’ve been impressed that distances seem shorter on the bike than they do in the car sometimes – perhaps I’m enjoying the trip more? And when my destination does not have easy parking in front, riding is really nice because I can usually lock up outside the front door and save a meaningful amount of parking and walking time.

Thanks again for the encouragement, and enjoy the mild weather!

We like burgers, and have tried many of the options (though not all … yet). Each offers something a little different, and has their own strengths and weaknesses. In alphabetical order:

• The Burger Joint: West Hartford Center
• The Counter Burger: West Hartford Center
• Five Guys Burgers & Fries: Avon, Farmington, Enfield
• Goldburgers: Newington
• Jake’s Wayback Burgers: Rocky Hill, East Windsor, West Hartford*
• Max Burger: West Hartford Center
• Mooyah Burger: Downtown Hartford, West Hartford*
• Plan B Burger Bar: West Hartford, Glastonbury, Simsbury
• Red Robin Gourmet Burgers: West Hartford, Manchester, Enfield

* Announced, but not open, as of 11/10/2011

Another Note: This is not the complete list of places to get yummy hamburgers, just a list of restaurants with a strong burger theme. And it’s not even complete in this subset. At the time of the writing, a place called Burger Baby was announced for Downtown Hartford (hopefully the website will be up by the time you read this)

For me (Kyle), there is no one place that has the best of everything. If it were possible to mix and match a meal, I would get my burger at Five Guys, onion rings at Counter Burger, and a shake from The Burger Joint. The Five Guys fries are also top notch, and the price is at the lower end (since it’s more like fast food than fine dining), so I tend to gravitate there even though milkshakes are not available.

Amy agrees that there is no one restaurant that hits the magical burger-fries/rings-shake trifecta. She is partial to the Plan B burger, the Five Guys fries, and the Counter Burger shake. She also noted that she felt like she needed to do more research into the matter since we haven’t thoroughly vetted all the options. Mmmm, sounds like delicious work…

So readers, what do you see as the best-of-the-best out there?