Archive for February, 2016

Manchester NH and most of the other towns and cities in New Hampshire have sent out there final tax bills which means the clock starts for tax abatement season. If you are a homeowner and are paying property taxes, you may be eligible for a tax abatement. Your property taxes are based on your property assessment that your town or city assigns you. Most assessor’s do a great job, but there job is very difficult. They must design a computer/statistical model that will accurately appraise thousands of parcels at the same time. Even the best of models will not fit every property, which is why in every town, nearly a 1/3 (33.3%) of the properties are over assessed and a 1/3 are under assessed. It’s the 33% of the over assessed who can get a tax break on my plan (there I go again…lol).


Click for Tax Abatement Assistance

Many people look at their assessment and say to themselves “Oh, I could never sell my house for what it’s assessed for!” …lol That doesn’t mean your house is over assessed. Sounds confusing, but I will explain why.

In every town, it is the assessor’s goal to have assessments equal the true market value of the property. Every five years or so, the town does a complete revaluation of their town to do this. Each year thereafter, the assessment stays the same, but the market value could go up or down which means the assessments are higher or lower than market value. Here is the key…… As long as every property in the town is either over assessed or under assessed the same, then it is fair. You are only entitled to get a tax abatement if you are MORE over assessed than average person in the town. Here is an example.

If the “Assessment ratio” for the town is 110%, which means the average property is assessed at 110% of the actual market value, you will not be able to fight your taxes if your house is assessed at $220,000 and is only worth $200,000. The reason being is that your house is in line with the 120% assessment ratio ($220K is 110% of $200K). If your house is only worth $160,000, you may have an excellent case to get your $220,000 assessment reduced down to $96,000, since $192,000 is 120% of $160,000. If you can prove your home is worth $160,000, your assessor may reduce your assessment in this example to $192,000.

“Margin of Error” Most communities will only reduce your assessment if your “equalized assessment” is more than 10% higher than market value. This is because there is a reasonable “margin for area” due to complexity of assessing an entire community.

The State of New Hampshire Department of Revenue provides the official “Assessment Ratio” for each town in the State on an annual basis. That is one half of the equation. The other half is figuring out what your property is worth in terms of market value.

In abating your taxes, if will be necessary to provide “proof” of your market value estimate, as of April 1st of the tax year being appealed. This can done by hiring a Certified Appraiser like myself to provide a professional opinion of value. The appraisal with be attached to an official abatement form and will need to be filed in a timely fashion.

If you would like to contact me and find out if you are a candidate for a tax abatement, feel free to contact me @ jacklavoie@comcast.net. I do residential and commercial tax abatement appraisals throughout the state of New Hampshire should you need my assistance.

Tax bills will be mailed out soon. When you receive your tax bill, get the process going and you may be one of the 33% who can get an abatement!!

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Tax abatements, Obtaining a Divorce Appraisal, “Does recessed lighting add value” and should I wait until spring to sell”?

Home seller:   Should I wait until spring to sell my house”   (note: this person is located in Greater Manchester, NH)

Jack:  If your house is prepared to sell (cleaned, repaired, de-cluttered etc) I would NOT wait to sell.  There is currently a shortage of houses on the market in many sectors.  There are a reasonable amount of buyers out looking. Certainly more buyers will join the market in the spring, but along with many more listings (houses on the market).  Inventory is low, so you many be able to take advantage of a window of opportunity.   (Note: Before listing your house, you want to see what the inventory/competition is for your market as each market is different).


Homeowner going through divorce:   Do we each have to get our own appraisal?

Jack: There is no rule that says anyone needs to get an appraisal, however if you are contesting the value each side certainly ought to get one to protect their interest and make sure they have the most updated information with regards to the market value of the house. I have done many “joint” client appraisals in which the divorcing couple hires me together as an independent appraiser. In an amicable situation, I think that is a great idea. Just beware, that if you don’t like the results, your spouse can submit the appraisal into court as evidence.


Homeowner: Does recessed lighting, crown molding etc add value to a house? How much?.

Jack: While it is very difficult to nail down the precise difference in value attributed to one features (lets say recessed lighting versus traditional), it does go toward the overall quality of the house. It is the goal of the appraiser to compare houses of similar quality, which means your house would be compared to a better grade of house than houses that do not have similar quality features. When evaluation quality, SOME of the characteristics are; exterior ornamentation, interior refinements/detail and quality, ceiling height, quality of finish materials, efficiency of systems (heat, electrical etc) and much more.   While one item by itself may not change the value by itself, it does go to the overall quality of the house.


Property taxpayer: When is the deadline for to appeal my property taxes?

Jack: The deadline for all New Hampshire municipalities is March 1, 2016 for appealing your 2015 taxes. The date is a “hard date” and will not be extended. The municipality has until July 1, 2016 to either grant or deny your request. If they do not act on it, is automatically considered “denied”. Similar to presidential “desk veto”.   If your abatement application is denied, you can appeal it to either the State of New Hampshire Board of Land and Tax Appeals (BTLA) or the New Hampshire Superior Court. The following is a link to the New Hampshire tax abatement form.

Click to access 2015abatement.pdf


If you have any questions on real estate, appraisal or finance questions don’t hesitate to contact me at (603) 644-1000 or email me at: jacklavoie@comcast.net.   Check out my website at www.AppraiserNH.com

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Try this short quiz to see which 2016 Presidential candidate you side with…


Jack Lavoie, SRA
Designated member Appraisal Institute
Accurate Appraisal Services
a division of Jack Lavoie Real Estate, LLC
62 Quincy Drive
Bedford, NH 03110
Office: (603) 644-1000

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Here are a FEW of the questions I fielded this week:


Homeowner (who is also a broker): We are thinking of adding an enclosed porch, but not sure if we will get a return on our investment. Do you think will get our money back?

Jack: You actually have two questions there. Should you build the porch? And will you get your money back (in increased value or resale)? With regards to the latter, it is quite possible you won’t get a dollar for dollar return. As a general rule, when you cure a problem (I.e. Fix something that’s broke) you often get more than a dollar for dollar return. When you add features that are beyond what the “typical house” has, it generally costs more than what you will get in increased value.   If you are adding a feature that is expected in the market that nearly all competing houses have, you probably will get full value back. With regards to the enclosed porch, it may only increase the value a 1/3 to 2/3 of the cost of house. So, in answering your second question, the answer is NO (you will NOT get all your $$ back). As to whether or not you will do it, it is a function of how long and how often you will use and home much enjoyment it brings you. As an example, if it costs $18,000 and you only get a $9,000 return, but you enjoy the porch for the next 10 years, than I would say “Who cares” if you don’t get your money back in resale, since you have gotten your value back in the way of enjoyment.


Homeowner: I have a 4.375 interest rate. Does it make sense to refinance?

Jack: first of all, I am not a mortgage expert, but I can give you this general advice. Whether or not you refi is a function of your new interest rate, the new loan costs and how long you expect to own the property. This is how you calculate savings and break even. Let’s say you are going to save 1/2 percent on your rate and you have a $200,000 mortgage. That means you will save $1,000 (1/2 of 1 percent) on annual interest. If the cost of the loan is $2,000, it would take you 2 years to break even. If you plan on owning the property for more than 2 years it probably makes sense. Many lenders with also do a no closing costs loan in which they will incur the cost themselves and build those costs into the new interest rate, which will be higher than if you paid the cost. So, if you are not sure how long you will own your house, you may pay no closing costs and just lower the rate to just 4 percent (as an example). Nothing to scoff at since even lowering 0.375 percent will save you $750 per year in interest or $63 per month. Not bad for “free money”. Lastly, I BEG you to use a LOCAL lender. Don’t get tricked into thinking these national online lenders are better.


Homeowner: Last year the bank appraised our house for $215,000. This year they appraised it for $210,000. How can that happen when values in town haven’t gone down.

Jack: It is possible for it to happen as each and every appraisal has a reasonable variance and at any moment of time the quality and quantity of data can vary. Here is an example. Let’s say that a house’s true value is $200,000 (The great appraiser in the sky says so. Lol). It would be reasonable to see an appraisal on the house that could vary 3 percent or $194,000 to $206,000. Let’s say your “$200k house” appraised for $205k. Fast forward to this year and let’s for example sake say that your $200k house has increased by 3 percent from the previous year and is now worth $206,000. A reasonable appraisal with a 3 percent variance could yield an Appraisal of approximately $200,000 to $212,000. Let’s assume the appraisal came in on the lower end of the range at $202,000 or $3,000 less than the appraisal last year. Different sets of data can yield different results. It is possible like my example for an appraisal to come in lower than a previous appraisal even if the overall market has not dropped.


Let me be your point man for information!  If you have any questions or need some assistance, don’t hesitate to call contact me at (603) 644-1000 or jacklavoie@comcast.net


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Here is a short little lesson on Negotiations.   No…. It’s not shoving your offer down someone’s throat.. To illustrate I will tell you a little story.. Here goes … Donald Trump (Please don’t sue me for using your name for this simple lesson!) and Chef Rachel Ray happened to be in the same kitchen  at a Trump Campaign stop at a Food Network event in Manchester NH and began to discuss one lonely orange that was on the table. Both The Donald and Rachael wanted the orange for themselves and began “negotiating” over who should get the orange. In fact, these two friends got into a heated argument but finally reached an agreement after making “low ball” and meaningless offers to each other. The agreement was to cut the orange in half and share it.
After they cut the orange, Trump peeled his orange, threw the peels into the trash and ate his orange.  Rachael, who was working on a new cooking recipe doesn’t like to eat oranges, so she threw out her half of the orange fruit part into the garbage and kept the orange peel to cook with. So here we are with a half of a perfectly good orange (Peel and fruit) in the garage….hhhhhhmmmm.
Moral of the story… had Trump and Rachael taken the time to find out the needs and viewpoints of the other side they could have each essentially had the whole orange. That is called a win-win. Next time you are negotiating with someone, take the time to find out what THEY want. If you do that, you will get more of what YOU want

As always, if I can assist you in any real estate, appraisal or financial matter don’t hesitate to call me at 603-644-1000 or email me at jacklavoie@Comcast.net

Disclaimer:  “Some” of thee story may be made up to teach you a great lesson!!!  LOL

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Today as part of an appraisal, I did an analysis of all single-family homes in Bedford (Condominiums NOT included).  The attached table shows statistics by 3-month and 6-month period.  Look to the right column and you will see that the number of active listings is at a VERY low 44 house which equates to only a 2.2 months supply.  This is very low and can be attributed to potential seller “waiting until spring” to place their houses on the market.  There is a window of opportunity to “beat the crowd”.  If you have any questions regarding Bedford or New Hampshire real estate, appraisal or finance, feel free to email Jack Lavoie a call at (603) 644-1000 or email him at jacklavoie@Comcast.net

Bedford Feb 1 2016

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My first “Monday Mail Bag” post. Every week I field many questions from brokers, mortgage professionals, homeowners/buyer, attorneys and other interested parties in real estate. On Mondays I will share some of the questions and answers. Here we go:


Q#1 – Broker: I have buyer considering purchasing a 2-family in Manchester. It is assessed as a 2-family, but does not have a certificate of compliance. The current owner has lived in the property since 1948 and says it is “grandfathered”. Do my buyers need to get a new Certificate of compliance?

Jack: YES!!! In the late 1980s when the Certificate of compliance (COC) program came into effect for rental properties, the city grandfathered 2-4 unit properties that were owner occupied for as long as that owner lived in the building and retained ownership. Any new buyer must obtain a new COC. A buyer will have to do some due diligence as some of the items, emergency exits, electrical, smoke detectors etc. can be expensive.  There may be an issue with the financing since the buyer will being doing the work after closing. It would have been smart for the seller to obtain the COC prior to listing the property to appeal to a broader group of buyers.  (note: Link to Manchester NH housing code: https://www.manchesternh.gov/pcd/Regulations/HousingCodeOrdinance.pdf )


Q#2 – Mortgage Professional: Does FHA allow “Driven Point Wells” for drinking water?

Jack: Yes, they are allowed however they must meet the Private well guidelines set forth in the HUD Handbook 4000.1     The handbook does not specifically address driven point wells therefore they are acceptable providing the local municipality allows them, it is an approved well and meets the current setback and flow guidelines. If the town allows it, and it meets all the other criteria, then HUD will accept it. HUD and the mortgage investor will most likely want to see evidence (by showing comparables) that other properties have this type of well.


Q#3 – Homeowner/Seller:   The IRS has agreed to release a lien on my house I am selling and they have asked for an appraisal. Do I need to get my own or can I use the one the buyers are getting from the mortgage company

Jack: You really should get your own appraisal for several reasons. 1) The IRS has different definition of value called “Fair Market Value” which is different than Fannie Mae’s definition of “Market Value”. 2) The mortgage appraisal does not come with the permission to use for another use such as having the lien released by the IRS. 3) If the IRS questions the appraisal you will want to have YOUR appraiser available to back up his/her appraisal. There is not incentive for the bank appraiser to do so since you are not their client. Getting an IRS lien is a BIG deal. It is worth the money for your own appraisal.


If you have any real estate, appraisal, investing or financing related questions don’t hesitate to call Jack Lavoie, SRA at (603) 644-1000 or email at: appraiser@jacklavoie.com

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