Shrugging off a pandemic, homes in the Oskaloosa area sold at a healthy pace over the past year – enough that all homeowners are likely to notice.
“Last year was the best year we’ve had,” said Ruthi Rogers, broker associate with Legacy Real Estate, which opened in 2014.
There were 301 residential sales in Mahaska County last year, compared to 258 in 2019, according to County Assessor Lindsey Thomas.
Marion County saw 1,262 residential sales in 2020 compared to 1,251 the previous year, according to County Assessor Kelli Kingrey. The numbers for both counties don’t include homes included in farm sales.
COVID precautions shut Rogers’ office for about seven weeks, but she continued to list and sell homes while working from her own home.
“It took everybody a little to get into the new groove,” she said. “Everyone worked really well together -lenders, appraisers, inspectors, everybody got it done.”
Those strong sales may increase property assessments used to calculate homeowners’ property tax for the year. State law requires a county’s assessed values on all properties but agricultural land to fall between 95 and 105 percent of market value – its “sales ratio,” figured by dividing a property’s assessment by its sale price.
Kingery said Marion County’s residential properties will see about a six-percent increase in valuation. Not all Mahaska County properties will see changes.
“We did not have an across-the-board adjustment, but rather had specific adjustments in land and building values in specific areas,” Kingrey wrote in an email.
Assessors analyze assessed values every odd-numbered year against comparable properties’ sale prices to assure assessed values accurately reflect the market.
The state Department of Revenue compares the year’s sales to assessors’ abstracts. If assessed values for a property class aren’t within five percent of the median sale for that type, they’re adjusted – the process is called equalization - to bring them into compliance with state law.
In a strong real estate market, that means sales may push assessed values higher for similar properties. Counties mail new assessments to property owners April 1, setting the basis for property taxes payable fall of 2022 and spring of 2023.
A higher valuation doesn’t necessarily mean a homeowner’s property tax bill will increase – that’s up to county supervisors, school boards, and city councils who can adjust the year’s levy rate to offset increased property values. The Iowa Department of Revenue determines the rollback – the amount of assessed value that’s actually taxable for each class of property.
New work-and-school-from-home routines seem to have altered many buyers’ preferences.
“For the longest time people wanted the big open floor plan,” Rogers said. “(Now), people are kind of wanting a semi-closed-off plan, because kids might have to be doing work in the dining room while she’s cooking in the kitchen.”
Rogers expects continued low interest rates to fuel buyer interest, resulting in a sellers’ market.
“People can buy a larger house at lower interest rates,” she said. “They can get a little more house for the money.”
At the end of February, the Iowa Association of Realtors listed just 31 homes for sale in Mahaska County, compared to 69 last year. The inventory was more stable in Marion County, where 110 homes were for sale at the end of February, compared to 113 in 2019.
The sellers’ market means most homes on the market are getting multiple offers, Rogers said.
“Most of those ended up selling over the list price,” she said. “You really have to be on top of things.”
That can be especially challenging for first-time buyers or those on tighter budget.
“It’s frustrating,” she said. “It forces my clients to make a hasty decision, and purchasing a home is one of the biggest decisions you’ll ever make in your life.”