School district quality and home values: A comparison

schools4For many prospective buyers who have children, or potential children in their future, a community’s school district is often a major consideration in choosing a place to call home. And, as goes the laws of housing economics, properties in sought-after school districts usually come with heftier price tags to meet that high demand.

Niche, a content startup that compiles and analyzes data on k-12 schools, came out with a ranking of school districts in the US and by state. And, as no surprise, a large number of Dane County school districts ranked among the best in Wisconsin. Of the 16 school districts in Dane County, all but 3 made it in the top 100, out of 424 Wisconsin public school districts total. Among the frontrunners were Waunakee, ranked 6th, Middleton-Cross Plains, ranked 9th, Sun Prairie, ranked 14th, and Verona, ranked 15th. Through statistical analysis and survey responses, Niche incorporated academics, health and safety, student culture and diversity, and extracurricular opportunities into each district’s ranking. Their methodology can be found here:

Most of these rankings correlate with home value. The average sale price for a home in the last 12 months in the Waunakee and Middleton-Cross Plains districts were $392k and $413k respectively, while price gradually drops down the list to the bottom Dane County rankers (Belleville, 117th, $224k/ Stoughton, 148th, $233k/ Marshall, 211th, $206k).

Of course neighborhood value is affected by other measures as well, such as walkability, proximity to downtown Madison, supply of housing, and access to other public amenities. So in an occasional twist of fate, there are some cases where an area’s excellent school district ranking does not translate to higher home prices.

The Sun Prairie school district stands out- ranked 14th in the state, the average sale price for homes in the last year was $251,977. Verona, which ranked 15th, has an average of $311,203. To put that in a different  perspective, the next highest district in Dane County that is more affordable than Sun Prairie is Cambridge, which ranked 62nd, with an average sale price of $241,293. Sun Prairie is growing like wildfire, creating a large supply of homes, and it’s likely that once more buyers tap into that growth, prices will rise.

Other standouts for educational-bang-for-your-buck are Mount Horeb, (21st/ $262,543) and McFarland, (22nd, $266,571). And, if you’re willing to go further from Madison, New Glarus in Green County ranked 30th, with an average sale price of $231,630 for the last year. For that price point, the next comparable district would be Deerfield, which ranked 71st and had an average of $229,108.

Oregon and Monona Grove, ranked 33rd and 36th, had average sale prices of $295,720 and $274,881. While on the pricier end, of all active single family properties currently listed on the MLS, 52% and 50%, respectively are listed below that average sale price. While it is difficult to compare data for closed properties versus active ones, this high percentage suggests that while many properties are more high end, and will sell for a higher price, there are plenty of affordable options in these communities as well.

In contrast, for the Waunakee and Middleton-Cross Plains districts, only 31% and 32% of active single family listings are currently priced below their average sale prices of $392,808 and $413,356 respectively. This suggests there is a lack of affordable single family homes in these communities.

The Madison school district ranked 58th in the state, but because it is so large, this ranking does not offer much insight into home value versus district quality. In this case, Niche’s high school rankings come in handy.  Niche ranked Memorial High School the eighth best in the state, and the highest-ranked in Dane County. The average sale price for homes within the Memorial attendance boundary was $275,597 in the last 12 months. While priced similarly to the Monona Grove district, there is a heaping ton of inventory. There are currently 257 single family homes for sale that feed into Memorial, and of those, a whopping 136, (64%) are listed below that average sale price, suggesting that number might be skewed upward from a few very high end sales. West High School, which Niche ranks as 10th in the state, had an average sale price of $323,828. That higher price is likely due to closer proximity to downtown, a smaller inventory, and better walkability marks.

Madison’s east side high schools jump down in rankings and sales price. East High and La Follette rank 244th and 273rd, with average sale prices of $204,295 and $201,577 respectively.

With high school rankings, it is important to note the comparison with home value is less thorough than with districts. A strong high school ranking does not imply that the k-8 schools that feed into it are also strong. Furthermore, while realtors are required to include school district information on their listings, they are not required to include individual school information. Most still do, but home values may be slightly skewed.

So, what does all of this mean? As always, your money can go further in certain communities over others, usually implying that you’ll have to sacrifice something or other in your home search. But it’s possible to have you cake and eat it too when it comes to school districts in a good handful of Madison-area communities.

 

 

Source: South Central Wisconsin Multiple Listing Service, Niche.com

Note: Data on average home value is compiled from June 2014-May 2015, and is based solely on single-family home sales. Data on active properties is as of June 5th, 2015

A guide to buying historic homes in Dane County

The majority of homes on the market in Dane County were built in the last 40 years. So, we tend to lump homes built before that into one category-“old.” But not all historic homes are made the same. Madison’s first settlers arrived in the 1830s, and the 120 years of development that followed gradually changed the cityscape, piece by piece. And overtime, home styles changed from stone cottages in Madison’s very early years, to Romantic period estates during the mid 1800s, to Victorian homes by the turn of the century, to the emergence of Prairie and Craftsman styles during the early 1900s, and to the innovative contemporary homes of the 1950s and ’60s. Each of these styles became popular  because of cultural and economic forces around in Madison at the time. While condensing 120 years of domestic architectural history into one article is an impossible feat, I have chosen just a handful of styles that were incredibly popular in the Madison area, and greater Midwest, during their time.

 

The Old Executive Mansion, 130 E Gilman St is a high example of the Italianate style, built in 1856.

Italianate: The Romantic-era Italianate style originated in England in the 1840s, and was meant to encapsulate the English’s vision of an Italian villa. The style was popular throughout the Midwest from the 1840s to the 1880s until falling out of favor. Italianate homes are characterized often by a flat or low pitched roof, projecting eaves, pedimented and arched windows, often very tall on the first level. More elaborate Italianate homes might have cupolas, balusters, large bay windows, or other adornments. In Wisconsin, most Italianate homes are constructed of brick or stone. Because Italianate homes are just a quiet minority in Madison’s housing stock, they are easy to spot. There are quite a few in the Mansion Hill neighborhood, the First Settlement neighborhood, and there are a handful in the historic downtowns of neighboring communities. While they can range from simple to elaborate, all Italianate homes give off a vibe of nostalgic stateliness that’s otherwise hard to come by.

 

204 Dewey St, a simpler Queen Anne home in downtown Sun Prairie, built in 1904.

Queen Anne: The Queen Anne style is the most common Victorian-era style in Wisconsin. It was so popular that when we discuss “Victorian” architecture in Madison, we usually are referring to the Queen Anne style alone. Technically a revival of architecture during Queen Anne’s rule in the mid 1700s, this English style arrived in the US during the late 1870s, and became incredibly fashionable during the 1880s and ’90s. While British in origin, Americans made it their own. These homes are characterized by steeply pitched roofs, front-facing gables, asymmetrical facades, large bay windows, castle-like turets, expansive, asymmetrical porches, and bold, cheery colors that showcase exterior adornments such as spindle work detailing. This style can be found throughout downtown Madison, as well as in the historic Main Streets of nearby communities.

1202 Sugar Maple Ln: An American Four Square  home built in 1920, on Madison's west side.
1202 Sugar Maple Ln: An American Four Square home built in 1920, on Madison’s west side.

Prairie: Frank Lloyd Wright, born in Richland Center, is considered the father of the Prairie style, and the most famous American architect.  The Prairie School, which really came to fruition in a handful of Chicago suburbs, is considered one of the first, truly American styles. Wright emphasized that buildings should be in harmony with their surroundings, to the point where they become part of the landscape itself. Prairie homes feature a strong horizontal emphasis, flat or very shallowly pitched roofs, and exaggerated, overhanging eaves. Many also have banded windows, massive porch supports, and hidden entryways. Generally, Prairie homes have significantly simpler exterior adornments than earlier styles. Although, many feature decorative casement windows, and terra cotta detailing. Earlier examples have boxier shapes. The most common vernacular style is the simple American Four Square house, found throughout Dane County.

744 Chapman St., currently listed by Tony Tucci, is a Crafstman style bungalow in the Dudgeon-Monroe neighborhood, built in 1930.
744 Chapman St., currently listed by Tony Tucci, is a Crafstman style bungalow in the Dudgeon-Monroe neighborhood, built in 1930.

Craftsman:

The Craftsman style, though originating in southern California, became widely popular nationwide. Partly influenced by the Arts and Crafts movement,   It was incredibly popular from 1905 to the end of the 1920s. The style was influenced Craftsman homes feature low-pitched gabled roofs, multi-paned windows, front porches, overhanging eaves often with exposed decorative beams underneath, and front porches with tapered columns. In Madison, the most common vernacular example of the craftsman style is the Bungalow, a 1 and a half story house, with a side gabled roof, dormer windows, and sometimes sloping eaves that cover a front porch. Craftsman houses tend to have detailed built-in woodwork and arched entryways. Bungalows can resemble the Prairie style as well, and can be found in most older neighborhoods. Check out the Marquette, the Schenk-Atwood, and Dudgeon-Monroe neighborhoods in particular.

The first Jacobs house, a Frank Lloyd Wright Usonian house at 441 Toepfer Ave, was built in 1937 and is one of the earlier examples of “contemporary” domestic architecture.

Contemporary: Contemporary architecture is a sub-category within “modern” American architecture. It rose to popularity during the 1950s through the 70s. The name “contemporary” can be confusing, because not all homes built during that period can be called “contemporary,” and homes built recently we would otherwise consider “contemporary”  are not included. But you know one when you see one. There are two types of contemporary houses- the flat-roof house, which comes from the International Style, and the gabled-roof house, which is influenced by Prairie and Crafstman styles. Both types often have exteriors of wood, brick and stone. They are usually one story. Many architects of these properties incorporated them into their landscapes in a Wrightian fashion. There are a small handful of “Usonian” homes scattered across the state. This style was a favorite among architects, and there are many in the University Hill Farms neighborhood in particular.

 

Often, we view purchasing a historic home as cumbersome: they’re not energy-efficient, they can take more work and time to maintain, and sometimes (with the exception of contemporary homes) their layouts aren’t the most conducive to modern life. But if you are genuinely interested in owning a home with history, the benefits, though at times difficult to quantify, are grand. Historic homes and streets help give the communities we know and love a sense of place and character. Historic homes help us understand the historical development of our communities, which in turn strengthens our connection to our neighbors, and communities themselves.

 

Five myths about bank-owned properties

20150114_103006Foreclosed properties dot every real estate market. Oftentimes, buyers have misconceptions about foreclosures, whether that be about the signed offer contract, or the property condition. While certain aspects of the foreclosure sale deviate from the normal sale, they usually do not vary as much as one would expect. Here are five debunked common myths about purchasing a foreclosed property.

  • Buying a bank-owned property means you’re getting a deal

Don’t get me wrong, there are deals to be had.  But the fact that a property is real estate-owned does not de-value it.  If the property needs repairs, or if it is being sold via auction and no contingencies are allowed, then it might sell for a lower price.  But if a property is in good condition, it is listed on the MLS, and the buyer can have inspection and financing contingencies, there isn’t much reason for it to sell for any less than it would if it were not bank-owned. A house is worth what someone is willing to pay for it. And in Dane County, the statistics show that bank-owned properties do not sell for any less than non-REO properties, at least in terms of negotiated price from the asking price.  According to the MLS, in 2014, Dane County single-family foreclosures sold for an average of 97.38% of list price, compared to 97.33% for their non-REO counterparts.

  • Foreclosures are not maintained during marketing time

While some properties are not properly maintained during the foreclosure process, once the foreclosure is complete and the property is transferred to the bank or investor, the properties are usually maintained to a “t.” Listing brokers for Fannie Mae and Freddie Mac are expected to visit each property once a week to ensure the property is secure and preserved.  Before a property is listed, it is not uncommon to check the HVAC, roof, or the well and septic system. Emergency repairs are typically done as needed.

  • Bank-owned properties are more likely to come with serious issues

Bank-owned properties come in all shapes and sizes. The stereotypical image exists in the real market: the run-down, dated home that reeks of must and mold. But of course there are plenty of foreclosures that are newer, or had loving owners that kept up their home who fell on hard times.

  • The transaction process is cumbersome and complicated

Purchasing an REO property from the MLS should not be more complicated than purchasing a non-REO property. Freddie Mac, Fannie Mae and many banks have their own addendums that must be part of the offer. But other than those and a couple disclosure forms, that is all.  So it’s just a matter of reading through the addendum and asking your realtor if you have any questions. Typically no contingencies are allowed beyond the inspection and financing contingencies.  Those contingencies are often in the addendum, so you need to take note if there is a difference from the State Offer to Purchase form.

This all doesn’t necessarily mean the paperwork is more confusing, but rather unfamiliar. Items in the contract though are perhaps more stringent. The bank addendums are typically non-negotiable and have the contingency timelines pre-set. Buyers should expect to close in a normal amount of time.

 

  • It doesn’t matter what kind of buyer you are- banks don’t care.

 

Owner-occupancy is often encouraged and supported by banks. Fannie Mae and Freddie Mac both offer a period of time (typically 20 days) when a property first hits the market where they will not entertain investor offers.  So this gives a preference to owner-occupant offers, at least for the first several days of a listing.  After that deadline is up though, investor-buyers are allowed into the ring.

Interpreting home value: It’s not just the house

The value of a home is calculated from much more than the house itself. The house next door, the width of the street, the age of the trees, all contribute to it’s value too.

Let’s zoom out. Are public amenities, such as parks and libraries, nearby? Land value will be higher if this is the case. How far is the house from the Capitol Square and UW, the two major employment centers downtown? Generally, (with a few exceptions), land value will be higher closer to these areas, and gradually decrease further away.

Higher land value usually means closer proximity to downtown, which for Madison, having become somewhat of a “boutique city” as of late, can be an indication of neighborhood quality. To accommodate that higher price of land, lots are smaller, and density is higher.

205 Highland Ave
205 Highland Ave
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7229 Iris Bloom Dr

There are countless factors to take into consideration when it comes to understanding a property’s value. And, when buyers look at homes with a strict price point in mind, they will likely have to sacrifice certain items on their wish list. Finding a home in a great neighborhood-with walkable streets, proximity to local businesses and public services-that also has the square footage to accommodate a family, can be incredibly difficult. The price of a property that has both the neighborhood and the space that many buyers seek can be well-above price limits. The house one can purchase in a desirable neighborhood is just a fraction of the house one can purchase in a less sought-after neighborhood.

205 Highland Ave, a 2 bedroom 1 bath cape cod with 1,130 square feet on a .1 acre lot, is for sale for $269,900. And so is 7229 Iris Bloom Dr, a 3 bedroom 3.5 bath colonial-inspired home with 1,794 above grade square feet plus a finished basement and two-car garage, on a .16 acre lot, for the same price. Although the Highland Ave property is 74 years older than the Iris Bloom Dr property, both appear to be in great condition.

Why are these two properties the same price? The Highland Ave house is one block from West High, and is walking distance to shops on Old University Ave and Regent St. It’s an older neighborhood, meaning the streets are pedestrian-friendly, and the trees are mature. But, your house is just a few feet from your neighbors, which could contribute to a lack of privacy. Speaking of lack of privacy, good luck sharing that one bathroom.

The Iris Bloom Dr house is on the southwest outskirts of Madison, near Verona. The subdivision is only a decade old. It’s car-oriented, and the lots are larger, though while more spread-out, the lack of mature trees could also contribute to a lack of privacy. It is close to many parks, but access to other neighborhood amenities requires a car.

While the value of these homes on paper is the same, comparing them is comparing apples to oranges. When looking for your new house, think, “What do I value in a home? What’s most important to me?” Is it the charming Highland Ave streetscape? Or three and a half baths and a two-car garage on Iris Bloom Dr?

Source: Photos and listing details from South Central Wisconsin MLS.

3414 Valley Ridge Rd #4, Middleton WI

3414 Valley Ridge Rd #4

I just listed 3414 Valley Ridge Rd #4 in Middleton, WI for $89,900.  It is a 2 bed/2 bath garden style condo on the 1st floor.  The condo development backs up to Pheasant Branch conservancy.  The condo has brand new carpet and paint.  It is about 1200sq ft and includes 1 underground parking spot and storage unit.  Condo fee $195/mth.  Only $89,900!  This is a foreclosure owned by Freddie Mac.  Great deal!

Dane County Real Estate – Increase in Sales

March 2012 has given us some interesting, and mostly encouraging, statistics for Dane County real estate.  The number of sales for both single family homes and multi-family properties are significantly higher than they were one year ago.  358 single family home sales and 32 multi-fam properties sold in March 2012.  The numbers were 262 and 5 in March 2011.  A 37% increase in single family home sales and a 540% increase in multi-fam property sales!

At the same time, the number of condo sales actually decreased.  76 sales in March 2012 compared to 84 sales in March 2011 – almost a 10% reduction.

Overall, I think this is very encouraging.  It is not news that the condo market is the one section of the market that has been hit the hardest.  So to see those numbers still not quite recovering isn’t too disappointing, considering we saw such huge increases in sales for both single family homes and investment properties.

April has been another very busy month…at least it has seemed that way.  So hopefully we see a continued increase in real estate sales as we move forward in 2012.

1805 Tarragon Dr – Amazing Home on Madison East Side

Incredible home for sale on east side of Madison.  6 bed/5.5 bath, 4388 sq ft custom built home with LOTS of upgrades & features.  granite countertops, hardwood floors, 3car garage, sun room, hot tub, theater room, the list goes on.  This is a $450-$500k home for sale at $397,500 list price.  You must walk through this house to appreciate all that it has to offer. Very convenient location off of Buckeye Rd.  Backs up to Abundant Life Christian School, so you esentially get some extra backyard.

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