Real estate values in New Canaan are down by 2.8 percent, according to a preliminary revaluation released by the assessor's office last week.
The overall value of assessed real properties -- including residential, condominium and commercial -- in 2013 is projected at $7,762,131,420. The number will be adjusted after personal property and motor vehicles are plugged in, which will create the grand list, and after the Board of Assessment Appeals makes its own changes in April. Assessor Sebastian Caldarella said personal properties and motor vehicles would add about $300 million to the total.
One takeaway from the preliminary data is that the housing market is seeing more activity, but less money is being spent.
"They're buying more for less," Caldarella said. The value of properties under $1 million increased 4 percent last year. The value of homes $6 million or more decreased by 13 percent and the value of those between $4 million and $4,999,999 and $5 million and $5,999,999 decreased by 11 percent.
Realtor Barbara Cleary said the 2008 financial crisis is the main reason why lower-end home values have gone up.
"People have experienced the recession," Cleary said. "This kind of phenomenon ripples all of the high-end homes."
The value of properties costing between $1 million and $4 million in New Canaan was mostly flat in 2013. As Realtor John Engel, who also serves on the Town Council, put it, "both ends of the seesaw are changing a lot, but the middle is flat."
The data released last week comes from the latest property revaluation conducted in 2013.
A revaluation is a state-mandated process of performing market analysis and assessments to determine accurate and equitable values for all properties in town. The purpose of a revaluation is to create an equitable distribution of the tax burden.
The state requires that revaluation be done every five years. The firm J.F. Ryan Associates was chosen, through a bid process, to do the revaluation in 2008 and 2013.
The difference between the revaluation and the annual assessment is that the former is similar to a mass appraisal.
Compared to revaluations in Wilton and Darien, Sebastian said New Canaan "didn't get hit" so badly. Darien, which also had a revaluation done last year, is looking at a property value decrease of 7 percent. Wilton, which had a revaluation in 2012, saw a 17 percent decrease in property values.
Residents should have received their new property assessments by mail, but the data can also be found on the town's website, newcanaan.info. Homeowners who do not agree with the assessments can file an appeal with the Board of Assessment Appeals from March 1 to 20.
The appeals usually are made in February, but because the assessor's office is in a one-month extension, everything was pushed back one month, Caldarella said.
A revaluation may result in an increase or decrease of property taxes, but the assessment is only the base used to determine the tax burden. The tax increase or decrease is also driven by the town's budget.
Some factors that are examined during a revaluation include size, location, age of improvements, topography and utilities, among others.
Caught by surprise
Properties that haven't had any changes may see an increase or decrease because general economic conditions, such as interest and inflation rates, also influence a property's value. The assessment represents 70 percent of the estimated fair market value.
"Regardless of whether they made improvements or not, we're following the market," Caldarella said.
But the revaluation caught many homeowners off-guard.
"It was a surprise to people who purchased properties under $2 million," Cleary said. "They feel like, `hey my house hasn't changed.' But it's more a matter of a market place economy. It's the overall picture."
Engel, who works at Barbara Cleary's Realty Guild, said he's been getting "a lot of emails from angry people," some who are upset their property value decreased and some who are upset it increased.
"Most homeowners were not prepared to see the value of their homes change double digits, since (many of them) didn't make any changes," Engel said. "Every hour of the day, someone stops me and tells me about their experience."
Engel said one of those people was a 90-year-old homeowner whose assessment went up 19 percent, and he had not made any changes to his property. Another resident was an 80-year-old woman who saw her property assessment go up 15 percent, Engel said.
At the Jan. 29 Town Council meeting, Police Commission Chairman Stuart Sawabini, whose assessment went up 10 percent, told the councilmen what would happen to his property taxes given the current revaluation and considering a hypothetical 6 percent increase in the town budget.
"If you factor a $222 million reduction on the grand list," Sawabini said, "increase the mill rate to accommodate the devaluations," and then increase the town budget by 6 percent, his taxes would end up 26 percent higher. "That's a shock to me," he said.
In an analysis he did of the assessor's data, Engel noted that the homes that decreased in value took $511 million off the grand list, while the homes that increased in value only added $286 million, "leaving us about a quarter of a billion short on the grand list."
"This will further raise taxes on the lower-valued homes as the mill rate will need to increase just to tread water before any increase in town budget," he said.
Engel noted that the revaluation is an opinion and it may be changed.
"The best thing you can do is to verify the facts," Engel said. "Look at your house and make sure they got it right."
If broken down by location, the value of downtown properties saw an increase of 11 percent. The north and south section both saw small decreases -- 2 percent and 0.5 percent, respectively.
Cleary said downtown saw an increase in value because it's more convenient to people.
"Downtown is the sweet spot of the town," Cleary said. "More people want to live near downtown for the convenience of walking."
If broken down by residential, condominium and commercial, the only type of property that saw an increase in value was the commercial -- 10 percent. The value of residential properties decreased by 3.2 percent while condominium properties decreased by 8.3 percent.
While the town's overall real estate value is declining, property sales are booming.
Residential property sales were up 28 percent in New Canaan last year compared to 2012. Data from the assessor's office shows that 349 residential single-family homes were sold in New Canaan in 2013. In 2012, 273 were sold.
The average residential home sale price in 2013 was $1,521,643. The number of sales has been going up consistently since 2010. In 2009, only 166 homes were sold, which represented a 32 percent decrease from 2008.
According to an independent market report by Barbara Cleary's Realty Guild, New Canaan saw a 24.7 percent increase in property sales -- single-family houses only -- in 2013 versus 2012. Wilton saw an 18.3 percent increase and Darien saw a 1 percent decrease, the report shows.
The total house sales in 2013 represent the highest year-end total since 2005, according to the report.
In the years after the recession, Cleary said, people were afraid buy houses. "They wanted to move, but it wasn't a time of confidence," she said.
If New Canaan is broken down by sections, downtown saw the biggest percentage increase last year, 6.5 percent, while the north section saw the most sales. According to the assessor's report, the north section is from Oenoke Ridge up and the south section is from the YMCA down.
The downtown section saw 93 sales with an average price of $1,128,981. The north section saw 144 sales with an average price of $1,955,960. The south section saw 112 sales with an average price of $1,479,987.
Cleary said realtors are optimistic about the next few years. "We're moving in to a good market."
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