Axis Philly: AVI’s Actual Impact on the Chestnut Hill Real Estate Market

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While some Philadelphians have been scrambling in the wake of the city’s property value reassessments under the Actual Value Initiative, some residents of Chestnut Hill who are selling their homes have had no problem doing so.

Matt Paul recently sold his home on 263 E. Evergreen Ave. in Chestnut Hill. While he had difficulty selling his home when he initially put it on the market in 2012, after he re-listed the property at a lower price it sold with relative ease. Paul said he believes that AVI had no impact on his ability to sell his home and is not even the biggest factor at play in Chestnut Hill’s real estate market.

“A lot of people in this area have tried to sell their homes,” Paul said. “This area has decent turnover, it’s a popular area to live. People are moving here later in their years and the biggest issue in this area is schools, choosing what school their kids will go to.”

Paul did note, however, that the reassessments could impact other homeowners in the neighborhood.

“If taxes were raised, people would have a harder time selling their house,” he said. “We weren’t affected because our taxes actually went down slightly.”

According to the Philadelphia Office of Property Assessment, after the reassessments Paul’s property value increased from $114,000 to $259,300. However, under the 1.3 percent tax rate proposed by Mayor Nutter on March 16, Paul’s property taxes would actually decrease from $3,564 to $3,429—a drop of 4 percent.

Ritchie McKeithen has been Philadelphia’s Chief Assessment Officer since 2010. He said he doesn’t believe that it is fair to say that the reassessments have any affect on Philadelphia’s real estate market yet.

“We wont know that it will affect the real estate market in Philadelphia until we look at sales over the next couple years to see what affect it may have had and try to extract that out to see if the higher values had anything to do with it or if it was just the economy or something else in the marketplace,” McKeithen said.

“The best thing I can say is that prospective buyers should estimate the taxes for the market value of the property and what it would sell for.”

Philadelphia’s elected officials are slated to make the final decision on the proposed tax rate this summer when they vote on the city’s budget.  Ultimately, that final tax rate is what will determine the Actual Value Initiative’s true affect on Philadelphia’s real estate market.