Second Village-Wide Revaluation in the Works in Scarsdale

The Board of Trustees held a meeting to update Village residents on the second village-wide revaluation on Tuesday night November 17th. John Ryan, who served as a consultant to the village for the first revaluation was retained to conduct the second revaluation which appears to be an update of the 2014 revaluation as well as an opportunity to correct some of the inequities that resulted from the first pass.

The new revaluation will be based on sales data from July 1, 2013 to June 30, 2015 which will be used to assign market values to all of the approximately 5,300 residential properties in Scarsdale as of July 1, 2015. Explaining the process, Ryan said, "We will look at sales and compare them to the data about the existing inventory and create a model to evaluate all homes." Ryan contends that these new valuations will be done using recent data and that the prior assessments will not be a factor.

An appraiser will do a drive by to do a visual inspection of properties to be sure that the characteristics of the home match the data sheet and that no new circumstances require an internal inspection. The drive-by inspections will begin in January and Ryan has not yet developed models or algorithms to arrive at new assessments.

In response to complaints from homeowners about the last revaluation, the model will not include properties that were purchased to be torn down as some residents claimed that the land value of these properties was overstated and skewed results for their neighbors. Ryan said that the division between the home and land values on each appraisal are required by New York State but said he would seek to give a fair assessment of a property in its entirety, including the land and the home. Commenting on land values he said, "We are developing a total value for every property -- though New York State requires us to segment the land vs. the house. This is strictly for statutory purposes."

He then reviewed some very positive data about the market in Scarsdale.

A total of 260 homes were sold in the 12 months ended in June 2015 with a median sale price of $1,450,000, up 9.8% from the prior year when there were 265 sales at a median sales price of $1,321,000.

There was good news in the market for high-end homes as well. Ryan's numbers showed that 32 homes above $2.9 million sold in the 12 months prior to June 15, 2015 with a median sale price of $3,625,000. These numbers compare to 20 homes sold above $2.9 million in the 12 months prior to June 2013 and 24 in the year before June 2014. So, though there are widespread claims that the revaluation has dampened the market for homes above $3 mm in Scarsdale, the numbers prove otherwise.

Ryan noted that out of the 767 sales for the last three years, 90 of those, or 11.7% were for demolitions. He said this number is uncharacteristically high.

In the public comments portion of the meeting, Carol Silverman of Spier Road called for the village to invoke the Homestead Act and revalue the condominiums at Christie Place. These are now assessed on their potential rental income and pay taxes that are far less than single-family homes of equal value. NYS law allows the trustees to consider the Homestead Act at the time of a revaluation and they did so prior to the last revaluation. In response, the trustees said that they do plan to consider the Homestead Act before the 2016revaluation.

Barbara Greebel of Tompkins Road questioned Ryan on his fee of $245,000, saying, "That seems like a lot of money." She asked the trustees, "How did you pick this company?" Village Manager Steve Pappalardo explained that Ryan was familiar with the work and they opted to hire him to do the second revaluation. David Lee said, "We exercised our judgment." To that, Greebel said, "Oh, this is a fait accompli? Well I am sure you will do a good job!"

Steve Nicholas of Heathcote Road challenged Ryan on whether the current valuation would be used to arrive at the new assessment. He said, "When I give a second opinion, I don't look at the first opinion!" He also asked if the higher taxes would be considered in coming up with a market value and whether deeds that prevent subdivisions and the presence of wetlands would also be factored in. Trustee David Lee assured Nicholas that "the new assessments will take the higher taxes into account and prices will be adjusted accordingly."

Statistician Michael Levine from Walworth Avenue asked Ryan if he would be using linear regression and Ryan said it was too early to know what model he would design.

Steve Rakoff of Morris Lane appeared to be representing a group of homeowners in the Heathcote Association. He arrived with a series of spreadsheets of data focused on the outcome of the prior revaluation. He said, "People had problems with the land values – especially for teardowns. There were problems for the upper end of the market." He went through a lengthy examination of recorded sales and real estate taxes at different price levels that was difficult to follow from the audience. He said, "Listings of houses priced at $2 mm and above are up. There are 50 in inventory."

He then went on to claim that as a result of the 2014 revaluation, homeowners in Edgewood, Greenacres and sections of Fox Meadow were receiving "discounts" on their taxes, at the expense of the owners of the larger properties. He said, "If you live in Edgewood on .2 of an acre and send three children to the schools, Scarsdale is funding you to the tune of $67,000. You have a real deal!"

The current schedule calls for notices of the new assessments to be mailed out on June 1, 2016 so that residents can file grievances from June 1- June 21, 2016.