The property owners in Sumner County have enjoyed significant property value appreciation since the last reappraisal in 2014 and it is expected to continue for the foreseeable future. While the office can make certain assumptions based on current trends, it is best to validate those assumptions through research. According to the Nashville Business Journal, some of the hottest markets in the middle Tennessee area are located in Sumner County showing double digit value growth over the past few years. Dennis Ferrier, Fox 17 News, describes the current housing market as fast-paced, characterized by “high prices, lots of buyers, and little time” with a value increase of 9.2% since 2017.
It is no surprise that Sumner County has experienced a strong housing market. The foreclosure rate is at its lowest since 2000. Foreclosures remain consistent with the national average and, although past due rates have increased slightly, they are also at the lowest point as well. Middle Tennessee State University’s Business and Economic Research Center describes middle Tennessee growth as “still progressing and represents a robust working environment”.
Much of the success of Sumner County’s economic outlook is the result of an exceptional national economy. Under our current presidential leadership, the U.S. economy remains strong with unemployment at historical lows and GDP growth at historical highs topping 3%. The consumer confidence remains strong and the housing starts are continuing to increase as well as the retail and manufacturing indices. It is expected that the US economy will continue to grow over the next few years. It is important track these indicators as they can share a glimpse into the future economic outlook.
It is also important that the assessor’s office has a keen understanding of the market, as we develop statistical valuation models for the $15 billion of real estate in Sumner County. For many, the home represents the single, largest and most important investment they will achieve. Property owners in Sumner County can be confident in their investment being stable and appreciating in value. In capturing value growth since 2014, we analyze “qualified sales” to ascertain the market value.
Market value is not simply the exchange between a buyer and seller. The Uniform Standards of Professional Appraisal Practice (USPAP) refers to market value as a type of value, stated as an opinion, that presumes the transfer of a property as of a certain date, under specific conditions (the relationship, knowledge, and motivation of the parties; the terms of the sale; and the conditions of the sale such as exposure to a competitive market for a reasonable time prior to sale).
The date specific is very important and for the reappraisal it is Jan. 1, 2019. With this in mind, qualified sales prior to the opinion of value date are considered. When referencing the popular website “Zillow”, they indicated growth between 2014 and 2018 to be approximately 50 percent. The median house prices provided by the Sumner Association of Realtors indicated similar growth projections.
When citizens receive their assessment change notices in April and May, it is important to realize that the value change represents four years of appreciation. The common mistake is assuming it is simply an increase from last year to the current year. It is also important to realize that an increase in value is not an increase in taxes.
When discussing your value, we are limited to only discussing the opinion of value not the taxes due. We welcome differing opinions of value, through the appeal process, that are developed and evidenced through commonly accepted valuation methods.
Sumner County is enjoying unprecedented growth that is presenting numerous challenges. The infrastructure is an obvious challenge for the county and cities as well as the strain on education as more families call Sumner County home and the increase in criminal activity that comes with growth.
Our local policymakers must take a realistic look at the impact of growth and how to best manage its impact. The residential property owners account for nearly 80 percent of the parcel count leaving the remaining to commercial, industrial, and exempt properties.
Sumner County enjoys an exceptional credit worthiness due to a strong economy, however, debt capacity issues can prove a burden should we see a downturn in our economy and lagging indicators such as the Consumer Price Index, unemployment rates and gross domestic product. It is a policy challenge to balance the current growth of our county and provide the services expected by citizens, while maintaining a conservative fiscal policy.
John C. Isbell has served as Sumner County’s Assessor of Property since 2004. Having earned state and national recognition in assessment administration and education excellence, John is currently a national instructor in Assessment Administration and Tax Policy as well as holding the Assessment Administration Specialist (AAS) and Tennessee Master Assessor (TMA). He is also pursuing his PhD in Public Administration and Policy with research interests in tax incentive programs, government accountability, and transparency.