Home Values Fall As Bank and Freddie Mac Foreclosures For Sale Grow

by on Foreclosure Crisis

In Oakland County, home property values have been falling consistently. Factors being blamed are the loss of jobs and the large inventory of bank and Freddie Mac foreclosures for sale in the market. All homeowners are worried about the loss of equity on their homes and this is evident in the many appeals made every February, when notices of assessment changes usually arrive.

Last 2006, some residents of Rochester Hills have already called attention to the way properties are being assessed. Starting 1996, assessors rely on a study encompassing two year sales to determine a home’s true market value. But when property values started falling with the increase in foreclosures in Southfield, assessors decided to switch to one-year sales study so that the determination of home values can be made more accurately.

Despite the change, there was a still a problem since the adjustment came a bit late; as a result, homeowners were overtaxed and are still being overtaxed. The number of appeals involving these tax assessments peaked in 2009, but decreased in 2010. Last December, about $3.9 billion worth of property value in Oakland County is in appeal. The decline can be attributed to the system finally catching up with the current market situation, wherein bank and Freddie Mac foreclosures for sale are dragging home prices down than any other factors.

Assessors are having a hard time doing property assessment due to the foreclosure mess, which resulted to the flooding of the market with bank foreclosures in Michigan. Only certain percentage of the home foreclosures for sale sold are actually included in the study, which will clearly distort the data for determining home property values in a particular neighborhood.

Homeowners looking to sell their homes have finally accepted the fact that they are also competing with these bank and Freddie Mac foreclosures for sale. And as long as their home is on the market, foreclosed properties will continue to affect the selling price.

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