State equalized property values rise

State equalized property values rise in Metro Detroit
detroitnews.com  by Gary Heinlein

Metro Detroit’s seven-county area experienced its first increase in state equalized value of properties in six years, according to a report released Monday — a small but lagging sign that the region’s economy continues to recover.

SEV — or half of the market value a city assessor assigns to property — increased 0.2 percent this year, the Southeast Michigan Council of Governments said. It’s another sign that the region’s economy is improving, the group said.

“The growth of total SEV is definitely good news for a region that suffered a great deal in the recent collapse of the real estate market,” SEMCOG Executive Director Paul Tait said in a statement.

By contrast, property taxable value — the main tax base for municipal governments — fell 0.2 percent, according to SEMCOG. About 60 percent, or 141 communities in Southeast Michigan, experienced gains in property taxable value this year, the group said.

“The trend local governments have faced for several years of declining local property taxes appears to be over,” Tait said. “Local governments must, however, continue their efforts to make the most efficient use of tax dollars to deliver the highest possible quality services to residents.”

David Sowerby, portfolio manager at Loomis Sayles investment management firm in Bloomfield Hills, said even a small increases in real estate values is good news for the region.

“It is interesting SEMCOG is seeing an increase in SEV for Metro Detroit,” Sowerby said. “But it certainly has been at least a one-year-plus experience that real estate values have been leading the economic recovery in Metro Detroit.

“There are lagging indicators — and there are lagging, lagging, lagging indicators, and SEV is one of those,” Sowerby explained.

The SEV rise “bodes well” for the future for collection of property taxes, but that won't necessarily be felt immediately, he said, and maybe not for at least another year.

The number of communities losing more than 10 percent of taxable value declined to six this year, down from 24 last year. More significantly, 141 communities gaining value is up from 27 communities that do so last year.

Improvement in taxable value was uneven.

Oakland County’s Lyon Township Oakland led with a 5.2-percent increase, while Monroe County’s Luna Pier saw a 16-percent SEV drop.

Pontiac lost 15 percent. Other older communities also experienced significant losses, officials said.

detroitnews.com  by Gary Heinlein

Morris Hagerman is a local real estate agent with Real Estate One in Royal Oak, Michigan.  He serves Berkley and the other Woodward 5 communities, including Ferndale, Pleasant Ridge, Royal Oak and Huntington Woods.  Hagerman is also a member of the Berkley/Huntington Woods Area Chamber of Commerce.  You can contact him by phone at 248-854-8440, email at morrishagermanproperties@gmail.com or visit his web page.