Has your neighbor abandoned their house?
It seems that many of us have heard of someone just opting to leave their home/property and they have not even received a foreclosure notice. Some of us know someone personally that decided it was just cost too much to stay in their house/condo and decides to relocate. Yet they've abandoned their homes.
I talked with gentleman the other day and explained why he and his family chose to leave their home. He mentioned they lived in an area that is considered historic. That situation added a bunch of pricey stipulations that lead to costs and expenditures they could not foresee. For the past 9 years they've lived in the house and in the beginning it seemed affordable. They were both making a lot more money. Each worked in the real estate industry. Fast forward to present day and the value of their property climbed from the $180,000 originally purchased in '01. The property values and soared and the tax valuation appraised at a maximum of $595,000 in as little as 4 years later. The values depreciated in the following years and they were told the current taxable value is back down to $240,000.00 present day. What a rollercoaster! This ride however, has everyone sick.
What happened? Property tax values increased and so did their taxes, almost triple. They can't insulate windows to make the house more eco-friendly and therefore they pay an astronomical $900.00 plus per month to cool or heat their 5 bedroom house. Maintaining the traditional look of the house on the outside is more important to the City than make the home more energy efficient to the family. Can this be logical? It certainly isn’t affordable.
The refi to bring the house to historic standards cost them an additional $100K which they took equity from the house’s appreciating valuation to restore the house.
All in all, the cost of $3000.00/month and that doesn't include mortgage, water, maintenance and other expenses and they would have to agree, they would have to make a change, “We just can't afford to LIVE here. This is not living." They found a house they can rent for less than one third what they are spending on the house they own. "Things are looking brighter already."
Wow all I could say was WOW! There are so many stories just like this one. No one thinks about the other side of property ownership appreciating in value. It's a good day thinking you may sell your property for so much more than it's worth. But when you are paying triple what you originally paid in taxes in under 5 years you know you can have a problem.
Cost of living increases are not near as aggressive nor salaries or raises as property tax increases. This is only part of the seemingly insurmountable problems consuming homeowners with stress. Some say, homeowners that choose to abandon their properties may create problems for not only the homeowner and the banks but also communities. Neighborhoods or buildings with many foreclosed properties have very low property valuations. This affects the entire community.
What do we do? Where do we turn? There are no easy fixes but it seems that we may all need qualified mediators or special committees. These special mediators may need to understand how to create opportunities for homeowners to stay in their homes. There efforts and powers may require negotiating capabilities that don't begin and end with the banks but include banks, associations, public services, property tax auditors, City regulators, City Managers and County appraisers.
Special committees designed to truly help home owners stay in their homes with Advocates for more effective strategies and result driven protocol to enhance the process must be implemented. After all it benefits the homeowner, families, banks, the and overall contributes to a healthier, stronger economy.
That's just one perspective. What are your thoughts? Who is willing to truly make a difference by stepping up and creating some real standards and significant changes? With Election Day around the corner, I personally haven’t heard anything worth reiterating with enthusiasm concerning the real estate dilemma.
Your, REALTOR®Gurl
