By Karl Keith, Montgomery County Auditor
I recently joined Montgomery County Treasurer Carolyn Rice and several others at a meeting of the County Commission to voice our support for a permanent funding mechanism for the county’s Land Bank. For my part, I focused my remarks on why providing additional resources for the land bank will be beneficial to the community from my perspective as the county’s assessor.
When the county completed its last update of property values in 2011, it resulted in an overall decline in value of about 7 percent. Almost 160,000 residential property owners experienced some decrease in the value of their homes, more than 42% had decreases in value of 10 percent or more, and six jurisdictions – Dayton, Kettering, Washington Township, Trotwood, Harrison Township and Huber Heights – had declines in value of more than $100 million. Overall, Montgomery County lost $2 billion in property value.
Those were historic numbers with far-reaching consequences. Due to this loss in value, property tax revenues for the various schools and political subdivisions in the county fell by almost $23 million in 2012. This includes a $2.1 million loss to Sinclair Community College, a $1.2 million loss to the county’s Metro Parks, and a staggering $8.8 million loss to the county’s Human Services levies.
Since the update in 2011, the housing market has begun to show some signs of improvement, but these signs can be deceiving. The number of valid real estate sales has risen significantly. The total number of valid sales in Montgomery County for 2012 was 3,990 compared to 1,984 in 2011. The number of fourth quarter sales in 2012 increased 175 percent over the first quarter of 2011. However, much of the increase in the volume of sales is limited to just a small number of neighborhoods.
In fact, more than half of the neighborhoods in the city of Dayton had no sales at all in 2012. And, thirty-four percent of Dayton’s sales were limited to just five neighborhoods.
In the five neighborhoods where the greatest number of abandoned properties has been identified, there were only 17 sales, about 3% of the total for the year. Further, it is significant to note that these same five neighborhoods with the greatest number of abandoned properties experienced a decline in property values between 27 and 30 percent after the county’s 2011 update. Clearly, the negative impact of abandoned properties on the real estate market and on property values has been and continues to be dramatic.
The Auditor’s Office is currently working on the next update of real estate values, and as we look ahead to the 2014 Revaluation, my office expects values to continue to decline yet again. Based upon our preliminary projections, property values could decrease another six percent countywide. This will result in further revenue losses to entities throughout the county, including an additional annual loss to the county’s Human Services levies of an estimated $5.2 million.
There are a number of factors that are causing property values to decline, and the county’s Land Bank will not be able to address all of these factors. But providing additional resources to address the affect of blight in our neighborhoods will have a positive impact on property values over time and will help to stabilize the county’s tax base. An ongoing source of funding for the county’s Land Bank will provide valuable resources to combat property abandonment in our neighborhoods to the benefit of the entire community.