Property Values in Cherokee County

What’s up with property values in Cherokee County?

“My neighbor has been trying to sell her house now for 13 months.”  “We’ve had to drop our asking price for our property down to $30,000 in order to sell it.”  Everyone in Cherokee County has heard stories like this since the real estate market started its downturn the second half of 2006.  Does the downturn in the real estate market mean that your property’s value has decreased over time?  Does this mean the tax value of your property will go down for the 2008 Cherokee County Tax Revaluation?  Good questions.

HISTORY

Since spring of 2003, sales of real property in our county have been steadily rising.  In March of 2003, Cherokee County recorded 95 properties sold that month.  By May of 2006, the county witnessed 322 parcels sell that month.  In a little over three years, the rate of property sales per month more than tripled.  Then things changed.  During the second half of 2006, the number of real property transactions per month started to slide.  By November of 2007, only 111 parcels of real estate sold.  While Cherokee County typically sees a dip in property sales during winter months (January, February, March), what we have experienced since mid 2006 is a solid downturn in the real estate market.

PROPERTY VALUES

What is the best way to determine if real estate values are affected by this downturn in sales?  How about looking at VALUES!  To do this, County staff examined all properties that sold in 2007 (downturn in real estate market) that ALSO sold during the sales run up and peak.  If the real estate dip has influenced values, we would experience a decrease in sales price.  For instance, if you bought your home for $200,000 in April of 2006 and turned around and sold it for $189,000 in November of 2007, this shows a decrease in value of 5.5% (assuming no change to the property’s condition in the 19 months).  We studied 202 sales from 2007 that also sold during the sales run up and peak.  Of these 202 sales, 190 showed a clear increase in value as based on sales price.  94% of the sales in 2007 increased in value! 

CONCLUSION

To answer the questions posed earlier, the downturn in the real estate
 market has had no negative impact on property values in Cherokee County.  It’s important to note that neighboring counties in Western North Carolina have experienced the same situation as Cherokee County.  State Law requires the counties to appraise real property at “market value” for tax purposes.  The vast majority of real property values in Cherokee County have increased since the last revaluation in 2004.