I’ve been
thinking a lot about our codes lately. Mostly about visual blight issues. And as
I’m sure we all have our own personal code pet peeves, I thought to see how
this may relate to our property values.
Using online
service Zillow as an illustration, I looked up my homes value compared to the
rest of zip code area 33161. Now, this may not be, and probably is not an exact
science, but it does provide some noteworthy data. According to their Zestimate
(clever play on words in my opinion),
my property value dropped $4,126 over the last 30 days - but was 155% higher
in value than the surrounding 33161 zip code areas.
My next
thought was… why such a big difference? And how do our codes possibly affect this? To
this end I reached out to blog member and resident professional realtor Brad
Piper with Keller Williams. Please find below our discussion
pertaining to property maintenance and property values.
MH: Brad, first I want to thank you for sharing both
your time and expertise in helping our readers better understand the
relationship between property maintenance and property values. Question, based
on your prospective new buyers, what are you hearing about Biscayne Park in
general?
BP: My pleasure Milton and thank you for creating
this informative blog. My buyers have
expressed that Biscayne Park has a unique “sense of community” that they
haven’t found in other areas. Even
though we have seen prices increasing in our area, buyers are still seeing value
for their money here in Biscayne Park. They
love seeing families strolling in the park, dog walkers, joggers, and the
community interacting as a whole.
MH: Can you explain for us how Zillow works and how it
arrives at its valuations?
BP: Zillow is strictly based on data collected
from closed sales in your area, and is meant to give a general estimate of
value. Homes and communities are
uniquely different, and those differences can have an affect on your property
value. An appraisor will be your best
source for an accurate estimate of property value, and will also take into
consideration the condition of the home, and the characteristics of the
location.
MH: Brad, can you provide some common property
maintenance issues that potentially reduce our property values?
BP:
Dirty exterior, faded chipped paint, overgrown yards, roofs and fences in need
of repair, are just a few examples. Keeping in mind that the maintenance of your
home’s exterior can impact your neighbor’s curb appeal, and collectively, it
can have a negative impact on the entire community.
MH: And while on the subject, can you mention some property
maintenance and curb appeal tips that could possibly increase our property
values?
BP: General
landscaping and updating of roof, windows, shutters as needed. Consistent maintenance and improvements tend
to help support property values, and reflects on the entire neighborhood. Programs such as www.ygrene.com could be a great resource for
homeowners on a budget, who need to make repairs to their homes.
MH: Good to know Brad. Another question, I noticed that Zillow
listed my homes value approx. 11% higher than other BP properties. It’s not
specific as to the other properties and I was curious as if this is due to
location. Have you an explanation for this?
BP:
That’s a great question and I would assume it’s due to the sales in your
immediate area. In a marketplace where
there is a wide price range of home values, we see the most discrepancies in their
pricing. Zillow’s accuracy has always been in
question, and can sometimes be misleading for home owners.
MH: Lastly, is there anything else that you would like to
share with us regarding the relationship between property maintenance and
property values?
BP:
We are all in this together, so your
lack of exterior maintenance could affect your neighbor’s property value. Even though we may not be ready to sell
today, life events can change that scenario quickly, and being prepared could
increase your sales price making the transition, much more pleasant.
Well, that’s
all useful information. Thank you again for taking the time to discuss this
with our readers. There was one point that really struck home with me from
Brad’s comments. “We are all in this together” is so true and vital for
fostering a good sense of community.
Last month I
had the opportunity to spend some time with our code officer driving through
the Village during one of his inspections. This helped me to gain a better
understanding of some of our issues and areas where we can improve with our
overall property maintenance. I can tell you that I have already seen positive results
based on that time spent together. It may not always happen as quickly as we
like, but I can attest first hand that code improvements are indeed
happening.
If any members
or readers would like to comment on any specific code issues that are on their
minds, and would like to see addressed in a future post, please feel free to do
so in the comment section below. As Brad says “we are all in this together.”
Milton
Hunter- The Biscayne Parker
Thank you for this blog post. I have two questions for our resident realtors:
ReplyDelete1. Can you weigh if it is financially smart to invest $20,000 to $30,000 to install impact windows/doors to a 3/2 or 2/1 and what impact this could potentially have on our property values?
2. What interior home improvement investments are best to make for resale?
3. Is there a percentage of the current market value of your home for which you should not exceed investing in, assuming your home is in relatively clean condition (not in complete disrepair)?
Thank you for your input.
Great questions and let me see if I can add some insight.
ReplyDelete1. There are some variables that could apply for example.... an owner occupied home vs. an investment property to be used as a rental. Many buyers are specifically looking for a home complete with impact windows for an insurance credit, and may not have the liquid funds to do it themselves after the purchase. You may receive more aggressive offers with these types of improvements, depending how much value the buyer places on having impact windows already installed. Overall, my listings with impact windows do get higher offers. Shop around for prices..... depending upon the size, your estimates for a "average size" 3/2 or 2/1 should be in the $13K - $20K range. We recently had impact doors / windows installed on a good size 3/2 for $14,800.
2. Kitchens and bathrooms still top my list. Make sure you have an insurable roof, electric, and plumbing before getting into the aesthetics of the home. You can renovate and "polish" your home, however if the home is not insurable, then your losing potential buyers, and possibly your strongest offers.
3. There are all sorts of investment models floating around the internet in regards to renovations. Each marketplace has it's own unique characteristics, and you really need to analyze the comps in the area, and know the market trend for that neighborhood. If a person was in a more homogenous planned neighborhood (example: new construction subdivision), then one could use a percentage cap for their model, and possibly it would work. Here in Biscayne Park and other similar communities we see location, and architectural style playing an important role in when pricing your home.
Hopefully this answers your questions, and thanks for asking.
Brad
Brad,
DeleteThis got me thinking about something I saw recently on the Million Dollar Listing show. The 3 realtors were asked much the same question as #2. The only difference being that it was not limited to "inside improvements." Their answer was:
1) Kitchens
2) Bathrooms
3) Adding square footage
Now, of course they are selling million dollar+ properties. Would this still apply for homes more like ours?
Thanks,
Milt
Hi Milt,
DeleteSure it would apply, considering the condition or so called "bones" of the property. Adding more square footage such as doing a permitted garage conversion into a 3rd bedroom and 2nd bath could bring you more value than renovating a kitchen or a bath.... given they are functional and presentable. Obviously a conversion will cost more, however it's all about the percentage of return, and your budget. You can certainly make home improvements without getting into a full renovation, and allocate extra funds to the items that are a priority.
Brad and Milt - thanks for getting the ball rolling re: code issues. Not long after we moved here in 1978 we noticed the numbers (even back then) of properties not in good condition visually. At that time it was primarily contained to the area east of 10th Ave. We tried - sadly in vain - to convince those in office over the course of the next few years of the importance in cutting out the "cancer" before it spread. So of course - it spread - due in large part to too many commission members over the years not only supporting but in some cases fostering what I call a slob mentality. Their excuse? Individual Property Rights!!!! IMO You want individual property rights you move to 19 acres in the middle of nowhere. You don't move to a residential community of pretty much standard sized building lots because as you said Brad, "We're All In This Together". We've got to stop being afraid to piss off slobs (can I say piss off in the blog????) There is such an incredible amount of visual blight - much of it easy enough to fix without a tremendous investment of time or money. Houses do actually need painted and mildew is not an acceptable color. Living room furniture belongs in the living room, not on the front porch. Yes we pride ourselves on our tree canopy - but that should be living trees, not a dead tree canopy. Grass should be cut without needing a courtesy notice as a reminder. But - the bottom line for me is every one - especially those in office - should lead by example - and need to insist that the bar be raised to the highest common denominator - not lowered or dumbed down. Exceptions should be exactly that, exceptions. Instead the exceptions have become the norm. I firmly believe had we paid closer attention and been tougher in code enforcement our property values would not have tanked nearly as much as they did a few years ago. Only a couple cities in Miami-Dade tanked more than we did.
ReplyDeleteHi Janey,
ReplyDeleteWow, now tell us what you really think! [kidding] Yes, you can say "piss off" on a blog, however we do want to try to keep our language somewhat under control. Thanks also for putting this into a time perspective dating all the way back to 1978 as many of us haven't lived here that long.
Now, to a couple of your points. Soon after I moved in, there came a (well... there is really no nice way to put it) trashy large family that moved in across the street in a house that was too small for them. (I won't go into the details of how many times I had to go pickup dirty diapers from common ground areas, etc.) And all of this directly across from Village Hall. Uck!
Many times I wished for them to move to that 19 acre area... somewhere/anywhere far far away... and to another state or country or planet for that matter. But I digress...
For me, a focus on better codes enforcement is more of a mind-set than, as you mentioned, a large expense for homeowners. Do we have the want and will? Much of it to me seems to be lazy excuses. I.e. take the extra few steps and put your garbage cans out of line of sight. Know when to put your trash piles out. Break out the bleach a couple times a year for awnings and other exterior trim. Realize that trees and landscaping requires some degree of maintenance. That dead trees are just that... dead trees.(this isn't the Walking Dead... they're not coming back) Let's remove them and while we're at it, let's grind those stumps too. This isn't really rocket science after all. Let's have some community pride!
As in the Zillow example, I believe that part of the reason our property value are substantially higher than other 33161 area are due to our codes and property maintenance. But, how much better could it yet be? Do we have the will?
Ultimately successful code enforcement consists of three main areas: code compliance outreach (first identifying the main problem areas and requesting through email blasts or newsletter), code enforcement by the officer, political will aligned with municipal priorities/resources, legally reasonable and clear code (for the officer who must levy the warnings and fines) , and follow through with boards that have a clear and consistent knowledge of the code (and not permit someones individual beliefs of what "intent" was behind the writing of the code. Perhaps ask the staff on the best and balanced approach and their recommendation of how the residents can help!
ReplyDeleteMy perspective is simple but would really appreciate our village staff to comment if appropriate as they are likely already doing this:
1. Identify the most egregious and common problems (that directly impact safety or negatively impact property values) and focus on these first as a municipality.
2. respond to neighbor on neighbor issues as required
Rather then just adding to the blog - I prefer to ask the experts with municipal code enforcement experience: What are best practices with other municipalities? Let's not re-invent our own wheel at additional costs to the residents.
Tracy
To perhaps expand on my prior post. The job of Code Officer is surely one of THE toughest. If the Officer can be confident of full support and backing of the elected officials and the community to raise the standards by strictly enforcing the codes their job actually becomes easier - not harder. I think anyone who has lived here from the inception of the Code Department can attest to that.
ReplyDeleteJaney,
DeleteDuring my ride with Reggie (our code officer) I asked lots of questions about his challenges, etc. "How can we be more efficient?" And based on that conversation there are certainty things we ALL can do to assist him with his job. Starting with Support.
One of the big time wasters is the serving of compliance notices to repeat offenders. As I understand it here is a prime example: someone doesn't cut their grass (or trim their hedges... or any other basic violation) to the extent they're served a notice to comply. They now have 30 days. They "could" wait almost the entire time before cutting the grass. Upon inspection (prior to the monthly Code Compliance meetings) the grass has been cut, so they are now IN compliance. So, the property could have remained unkempt thus creating a visual blight for a long period of time - and then start the process all over again. Rinse and repeat.
There are no real "teeth" in our code as a deterrent for future repeat violations. Short story, several years ago I was fined $75.00 for running my sprinkler (on an approved day no less) 20 minutes over the allotted time frame. Oops, guilty as charged... wasn't happy about it -but guilty none the less. You think I've ever run the sprinkler late again? Nope, lesson learned.
This is what I am referring to as a real deterrent. All, if I am incorrect in my assumption of the compliance notice process, please let me know- I didn't fact check it prior to posting.
I was waiting to see if anyone picked up on one potential point made regarding our property values. Since no one has, and I feel it is an important point to make, I'll jump in. The purpose of pursing annexation is to add to and diversify our tax base. This is to insure the continuance of our Village as an independent entity and hopefully allow for some fundamental growth.
ReplyDeleteWe've been fortunate the past 2 years to have had a pop in real estate values. Is it another bubble? We'll see soon enough. That coupled with effective fiscal management has, for the moment, stemmed the tide of running deficits most years. But, we can't count on property values to continue to push higher… or possibly even remain stable where they are today.
Look at the difference in our Biscayne Park property values vs. the rest of 33161. What do YOU think they would look like if we failed, and we merged in with the other 33161 areas? Homes in North Miami (to me) look to be comparable in lot and home size. But 144% LESS VALUE - (using Zillow's average BP property and the average 33161 property)
Think about that for a moment.