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What you need to know for 01/22/2018

Home values rise on Hamilton Hill

Home values rise on Hamilton Hill

The success of housing agencies and enterprising Guyanese rehabbers has translated into higher asses

The success of housing agencies and enterprising Guyanese rehabbers has translated into higher assessments in the city’s Hamilton Hill neighborhood.

A decade ago, the average Hamilton Hill house could be purchased for $16,000 — and even at that price, very few sold. Taxes based on those prices were the lowest in the city.

Now, many Hill houses are selling for more than $60,000, with quite a few breaking the $90,000 mark.

The change has been heralded by some as a great success for the embattled neighborhood. But poor longtime residents are complaining that the “success” has now pushed their assessments through the roof — making it difficult for them to afford the taxes on houses they once bought for $10,000.

“The taxes are unbelievable, and it’s like hell living here,” said Schenectady Street resident Pamela LaBrake, whose house value rose 71 percent in the reassessment. “I don’t know why anyone would want to live here. We have one really good neighbor — and then we have all the awful neighbors.”

On her street — where her house cost $10,000 in 1984 — the average assessment now is $60,000. Her house is assessed at $55,000, which would actually lead to a $6 reduction in city taxes next year if the City Council doesn’t vote to increase the tax rate. But many residents don’t understand the difference between an increase in assessments and an increase in taxes.

And whether taxes go up or not, LaBrake and others say the assessments don’t make sense. The assessor has dozens of sales that show buyers are willing to pay much more than they once did, but LaBrake said the buyers must be “blind.”

“I’m serious. I was blind,” she said. “We moved in winter; it was quiet. And in the summer, it was like a war zone.”

Residents report hearing shots fired weekly, although all three of this year’s killings in the city so far have occurred in other neighborhoods, and despite regular police raids, many drug dealers still do business in apartments known as “drug storefronts.”

Making matters worse, recent surveys reported that one in every four houses on Hamilton Hill is vacant and only 24 percent of the houses are owned by the occupant.

For decades, the city’s grassroots solution to the crime problem has been to encourage homeownership, and Assessor Patrick Mastro said the rise in property values can be partly attributed to that work.

Over the past 18 years, Better Neighborhoods Inc. (BNI) has rehabbed or rebuilt 150 units — mostly two-family houses — in the neighborhood. All have been sold to owner-occupants. The agency has lately been improving the Hamilton Hill neighborhood one street at a time. It has rebuilt and sold 10 houses on Lincoln Avenue, an entire block on Paige Street and 10 duplexes on Hamilton Street.

“The so-called criminals, they don’t own houses. They’re tenants,” said BNI Executive Director Ed August. “The only way to get rid of them is to rehab [rental property] and get homeowners in there.”

BNI’s latest houses, all on Lincoln Avenue, have been assessed at $111,000 to $134,000, although BNI sold the houses to low-income residents for $80,000. Habitat for Humanity houses are sold for roughly the same price. That agency is building five houses on Schenectady Street, three of them already completed, and hopes to build two more there.

“If you don’t have the concentration, it’s hard to have an impact,” Habitat for Humanity Executive Director Jeffrey Clark said.

Police also cracked down on the open-air drug dealing in the neighborhood, which pushed dealers into houses throughout the city but also led to a significant reduction in shots fired on city streets. Residents of Hamilton Hill said they feel safer.

But they said the neighborhood is still too troubled to be worth the sorts of prices now being paid to live there.

On Emmett Street, for example, the average sales price is $64,500 — a far cry from the $40,000 paid just a few years ago.

In 2004, a Guyanese family bought 880 Emmett St. for just $45,000. They sold 20 months later for $90,000. The two-family house is now assessed at $87,500.

Another Guyanese family bought 822 Lincoln Ave. for $55,000 in 2007 and flipped it four months later for $94,000. It is now assessed for $89,800.

Mastro said he must assess the properties at the neighborhood’s average sale price, despite the reputation of that neighborhood.

“Look, let’s not kid ourselves. The old adage is true: ‘Location, location, location,’ ” Mastro said. “But we don’t skew the numbers. We’re not talking about only one sale. Values have increased substantially in eight years.”

He said the work of Guyanese rehabbers as well as dedicated homeowners and housing agencies likely led to the increase.

“If you improve a property, it’s going to have a domino effect. People who live there are going to feel obligated to improve their properties, and before you know it, the values have improved,” Mastro said.

He added that many buyers could be drawn to Hamilton Hill because of its large houses. For the same price in other neighborhoods, owners must accept much smaller houses.

“Just maybe they see the value in the dollar,” Mastro said. “They may not be able to afford that house in another community.”

Independent appraiser Bill McEvoy of Allstate Appraisal Services confirmed Mastro’s assessments, saying Hamilton Hill’s property values have been rising for years. The current assessments, he said, reflect reality after the real estate bubble burst.

“There was a lot of cheap money, a lot of investments going on. That drove up the prices to $110,000 [for two-family homes on Hamilton Hill],” he said. “They’ve been coming down ever since.”

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