Price was not right
During Boulder County, Colo.’s 2009 mass reappraisal, the assessor’s office geographic information system (GIS) team and appraisers analyzed areas with high numbers of foreclosures to ensure the accuracy of their reports. The assessors identified a cluster of fraudulent and suspicious sales, most of which took place in 2006, in three subdivisions in Longmont, Colo. All three subdivisions were new construction with no previous level of value. The suspicious properties had relatively high sales figures for the neighborhood, but the appraisers noticed the homes had less desirable features and sold for more than those with greater appeal.
The appraisers and GIS team looked at the sales between 2003 and 2008 and found that the values of approximately 4,000 properties were inflated or deflated by more than $500. Those properties were mapped, which showed that the home sales related to mortgage fraud falsely raised the assessment of similar homes as far as six miles outside the neighborhood with similar negative characteristics. Factors such as location next to a busy street were being weighed positively, which caused an artificial reduction in the value of golf course homes. “It even made it look like a benefit to back up to a highway,” says Brooke Cholvin, senior GIS specialist for the Assessor’s Office.
Using GIS analysis helped appraisers determine the value of each characteristic they use to appraise a property and the potential damage of overlooking a corrupt sale. Following the discovery, the assessor’s office changed the way it evaluated the city’s historic district. West of Main Street, the district had one foreclosure. To the east, there were several. To prevent an underassessment of the west historic district and an over assessment of the eastern side, the sections were evaluated separately. “If we hadn’t put the foreclosures on a map, we would have left it the way it had always been,” says Danielle Simpson, residential real estate appraiser for the assessor’s office. “In the past, we had not seen a statistically significant difference between the district’s areas, but foreclosures started to come into play and change that.”
Project: GIS analysis of foreclosures
Jurisdiction Boulder County, Colo.
Agency Assessor’s Office
Vendor Redlands, Calif.-based ESRI