F298614 | Omnilex

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COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD

STEIN B. JACOBSEN v. BOARD OF ASSESSORS OF
THE TOWN OF CONCORD

Docket No. F298614 Promulgated:
July 9, 2010

This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65, from the refusal of the appellee to abate taxes on real estate located in the Town of Concord, owned by and assessed to the appellant under G.L. c. 59, §§ 11 and 38, for fiscal year 2008.
Commissioner Egan heard this appeal. Commissioners Scharaffa, Rose, and Mulhern joined her in the decision for the appellant.
These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.

Stein B. Jacobsen, pro se, for the appellant.
Nina L. Pickering Cook, Esq. for the appellee.

FINDINGS OF FACT AND REPORT
On January 1, 2007, Stein B. Jacobsen was the assessed owner of a parcel of real estate improved with a single-family home located at 531 Monument Street in the Town of Concord. For fiscal year 2008, the Board of Assessors of Concord ("assessors") valued the subject property at $1,014,400, and assessed a tax thereon, at the rate of $10.72 per thousand, in the amount of 10,874.37. Concord's Collector of Taxes mailed the town's actual tax bills on February 28, 2008. On or before May 1, 2008, in accordance with G.L. c. 59, § 57C, the appellant timely paid the tax due on the actual tax bill without incurring interest. On April 30, 2008, in accordance with G.L. c. 59, § 59, the appellant timely filed an Application for Abatement with the assessors, which they denied on May 22, 2008. On August 22, 2008, in accordance with G.L. c. 59, §§ 64 and 65, the appellant seasonably filed his appeal with the Appellate Tax Board ("Board"). On this basis, the Board found and ruled that it had jurisdiction to hear and decide this appeal.
In challenging the subject property's fiscal year 2008 assessment of $1,014,400, the appellant relied on the testimony of his spouse, Joana Vizgirda, and a self-prepared valuation report that contained data pertaining to the subject property, as well as comparable-sales, "value-trend," and regression analyses, plus a letter from the sales associate who sold the subject property to the appellant, which explains several "limiting factors affecting the fair market value of [the subject property]." In defense of the assessment, the assessors primarily relied on the testimony of, and the appraisal report and valuation analysis prepared by, their real estate valuation expert, Jonathan Avery. Based on this evidence and reasonable inferences drawn therefrom, the Board made the following findings of fact.

The subject property consists of a 2.42-acre parcel of land improved with a 2,353-square-foot, contemporary, split-level, single-family residence, which the appellant classified as a "deck house." The parcel is identified as Parcel 1454 on assessor's Map H-6 and is located on the corner of Monument Street and Red Coat Lane. The subject property is situated in a residentially zoned area along Monument Street just north of Concord's central business district and approximately 300 yards north of the Minuteman National Historical Park. The one-half mile area beyond the national park includes the subject property and two other like-age, contemporary structures situated among a wide variety of antique properties. Contemporary homes similar to the subject are more frequently found in other areas of Concord, primarily in the Annursnac Hill area and in sections of West Concord near the Sudbury town line. An entry driveway and athletic fields associated with the Fenn School, a private, independent day school for boys in grades four through nine, are located across the street from the subject property.
The subject property's 2.42-acre, rectangular-shaped lot is slightly higher in the front along Monument Street. It slopes gradually down to wetlands in the rear, which comprise over fifty percent of the lot. The wetlands area is lightly wooded and includes typical wetlands vegetation and an intermittent stream. The uplands portion of the lot along Monument Street is primarily open with some shade trees and a stone wall along Monument Street.
The basement floor of the contemporary structure is at ground level on the front portion of the lot and a few feet above the wetlands. The front and south side of the lot have been backfilled to provide a small yard area around the structure. The driveway, however, is at ground level to access the garage under the first floor. The basement has a walk out exit to a large patio at ground level. Landscaping and foundation plantings are basic. The wood retaining wall and steps from the front walk down to the driveway are in a state of decay. The site has town water and a private septic system and is not located in a flood zone.
The subject property's contemporary-style residential structure has vertical cedar exterior siding and double-pane casement-style windows. The main floor of the interior contains 1,769-square-feet of living space, which consists of seven rooms, including 3 bedrooms, as well as two full bathrooms. The flooring is primarily maple with a parquet floor in the family room. The flooring for the master bathroom was recently replaced. The kitchen has vinyl flooring, and the main bathroom has a ceramic floor. The living room, which opens to the large, ten by twenty-four foot, wood deck, contains a floor-to-ceiling brick fireplace. The kitchen has Formica counters and wood-veneer cabinets with basic appliances.
The 600-square-foot garage is under the bedrooms and accessed from the driveway off of Red Coat Lane. The remaining portion of the basement is approximately seventy percent finished. This 584-square-foot finished area includes a family room with a fireplace, an office area, and a one-half bathroom. The family room has a walk-out exit to a large, twenty by twenty-five foot, patio with a storage shed on the north side. Utilities include a 100-amp fused electrical system, forced hot water heating system with two zones, a separate hot water heater, and central air conditioning.
Overall, the property is of average quality with several areas of deferred maintenance, including: areas of woodpecker damage on the exterior; several failing glazed windows; some unstained portions of siding; a decaying exterior shed; steps and retaining wall deterioration; and a deck in need of repair and refinishing. The estimated cost to cure these items of deferred maintenance ranges from $10,000 to $20,000. In addition, the subject property has an underground oil tank, which might have to be removed in order to sell the property. However, no definitive sales evidence was submitted in this regard.
In an effort to prove that the subject property was overvalued and should have been valued in "the low $800,000's" for fiscal year 2008, the appellant, through his self-prepared valuation report and the testimony of his spouse, Ms. Vizgirda, first analyzed four properties in Concord, which he considered comparable to the subject property. These properties sold from May, 2006 to January, 2007 for sale prices ranging from $640,000 to $875,000. Two of the properties were contemporary-style homes, similar to the subject property, while the other two properties consisted of Colonial-style and ranch-style homes. With the exception of the ranch, which was considerably smaller than the subject property, the other three properties' living and effective areas were reasonably comparable to the subject property's. The two contemporary homes were located several miles away from the subject property and had significantly smaller lot sizes, while the Colonial- and ranch-style properties were located significantly closer to the subject property and had similar-sized lots. None of these properties had extensive wetlands like the subject property, and they were not exposed to the same amount of vehicular traffic that the near-by private school created for the subject property. After adjusting the sale price of the ranch for its differing building style and the sale prices of all of the properties for locational but no other differences with the subject property, the appellant and his spouse derived adjusted sale prices for these properties ranging from $679,774 to $846,800. The appellant then averaged the adjusted sale prices and calculated an indicated value for the subject property of $778,628 using this methodology.
The appellant and his spouse developed his "location adjustment factor" for each of these properties by comparing the sale prices of three properties from what he deemed to be the subject property's neighborhood to the sale prices of three supposedly similar properties from what he deemed to be his comparable properties' neighborhood. The appellant did not institute any adjustments to the sale prices to account for differences between properties from what he considered to be the subject property's neighborhood and properties from his comparable properties' neighborhoods. The appellant simply claimed that these properties, which he compared to one another for purposes of devising his location adjustment factor, were similar enough.
A summary of the appellant's comparable-sales analysis is contained in the following table.
Subject
Property 57 Whits End Rd. 44 Jennie Dugan Rd. 47 Old Bedford Rd. 201 Inde-pendence Rd.

Living Area (SF) 1771 1773 1814 2160 1653
Eff. Area (SF)* 2404 2537 2482 2440 1963
Style Contemp. Contemp. Contemp. Colonial Ranch
Acreage 2.42 1.35 1.34 2.47 2.39
Br/Ba** 3/2.5 3/3 4/2 4/2.5 2/2
Year (Yr.) Built 1968 1971 1963 1996 1943
Eff. Yr. Built 1983 1990 1986 1996 1982
Miles from Town Ctr. 1.2 3.3 3.7 1.5 1.2
Wetlands Extensive None Under 30% Under 5% None
House Siting Near Road Sheltered Near Road Sheltered Near Road
Traffic Commuter Local Local Minor Local
View School Woods Woods Fields Woods
Sale Date 11/01/1988 11/02/2006 01/12/2007 10/25/2006 05/01/2006
Sale Price ($) 450,000 640,000 730,000 781,350 875,000
Bldg. Adj. ($)*** NA None None None 883,614
Location Adj. Factor NA 1.28 1.16 0.87 0.87

Adj. Sale Price ($)
NA
819,200
846,800
679,774
768,744

FY08 Assessment ($)
1,014,400
633,500
647,200
782,100
939,500
FY09 Assessment ($) 1,188,300 583,000 654,000 700,500 873,200
* Effective Area
** Bedrooms/Bathrooms
*** Building Adjustment
In addition to his comparable-sales analysis, the appellant and his spouse also determined a value for the subject property for fiscal year 2008 using a "repeat sale data analysis" along with "the Case-Schiller method" to adjust for changes in the residential real estate market. According to the appellant, the Case-Schiller Home Price Indices measure the residential housing market in a given metropolitan area and track changes in the value of the residential real estate. For this analysis, the appellant chose yet another purportedly comparable property located at 64 Deacon Haynes Road. This property was purchased in September, 1986 for $375,000, while the subject property was purchased more than two years later in November, 1988 for $450,000. Relying on Case-Schiller Indices, the appellant adjusted the purchase price of the Deacon Haynes Road property to $401,610 to reflect its purported value at the time the appellant purchased the subject property. Based on the subject property's purchase price of $450,000 and the Deacon Haynes Road property's time (or market) adjusted value of $401,610, the appellant calculated that the market value of the subject property was 12% higher than the market value of the Deacon Haynes Road property. Accordingly, when the Deacon Haynes Road property sold for $730,000 in August 2007, the appellant determined that the subject property's market value was 12% higher than that, or $818,000.
The appellant and his spouse next performed a regression analysis using seven 2006 sales of residential property on or just off of Monument Street. According to this data and his analysis, the effective area of the houses on these properties showed a "high degree of correlation" to their sale prices. The appellant's correlation coefficient was 0.92. With one exception, however, all of these properties had significantly larger effective living areas than the subject property -- double, triple, or even quadruple the area -- and even the lone exception was still approximately one-third larger. This method generated a value for the subject property of $829,137.
Finally, the appellant introduced without objection a May, 2009 letter from the listing agent who was involved with the sale of the subject property when the appellant purchased it in 1988, which described "several limiting factors affecting the fair market value of [the subject property]." These factors include: the diminished usability of the lot because of the wide-spread presence of wetlands; the proximity of the subject property to the Fenn School and the attendant increase in traffic and noise as well as the adverse view; the location of a flight path above properties in the area; the minimal setback of the subject property's house from the street; and the condition and outmoded design of the house. Because of these limiting factors, the agent wrote that, as of the date of her letter, May, 2009, the subject property would "sell in the $800,000 range."
After reconciling the various values suggested for the subject property by these four methods, the appellant and his spouse estimated that the subject property's fair cash value, as of January 1, 2007, was $808,600.
Relying on a sales-comparison approach, the assessors' real estate valuation expert, Mr. Avery, valued the subject property, as of January 1, 2007, at $1,000,000. Mr. Avery initially observed that Concord is an attractive community in which to live and real estate located in Concord commands a higher value than similar properties located in the immediate surrounding communities. Real estate values in Concord are significantly affected by neighborhood locations with the properties closest to the town center generally commanding higher values. Monument Street, Nashawtuc Hill, and some areas along Elm Street command the highest values. The housing market in Concord was quite stable on January 1, 2007 with average prices being maintained throughout 2005 and 2006.
In his valuation methodology, Mr. Avery first determined that the subject property's current use as a single-family residential property was its highest and best use. He next determined that the sales-comparison approach was the best method to use to value the subject property for the fiscal year at issue. He did not develop a cost approach because of the age of the property, the limited reliability of depreciation estimates, and the requirement of a professional cost analyst. He did not apply an income capitalization approach because the subject property was not an income-producing property.
In applying his sales-comparison methodology, Mr. Avery examined forty sales in Concord between January 2006 and April 2007. Of these sales, he determined that five had "good similarity" to the subject property. These sales ranged in price from $865,000 to $1,150,000. Their living areas ranged from 1,653 square feet to 2,672 square feet and all of their primary living areas were on one floor, like the subject property. Even though his comparable-sale properties had "good similarity" to the subject property, they also had notable differences with it. In his sales-comparison analysis, Mr. Avery adjusted for these differences and derived indicated values for the subject property, upon which he based his estimate of the subject property's fair cash value for fiscal year 2008.
Mr. Avery testified that Comparable Sale 1, 155 Monument Street, which sold in November, 2006 for $1,150,000, is located in a desirable area of Concord situated between the national park and the downtown area. He considered this location to be superior to the subject property's situs. He further observed that Comparable Sale 1's house is in better condition than the subject property's home, and it contains an additional bathroom, as well as superior exterior amenities. Mr. Avery also noted that Comparable Sale 1 has a superior view, but the subject property has a larger lot, a finished basement, and an additional fireplace. After applying adjustments to compensate for these factors, Mr. Avery determined an adjusted sale price for this comparable property and an indicated value for the subject property of $1,002,450.
Mr. Avery testified that Comparable Sale 2, 88 Indian Pipe Lane, which sold in July, 2006 for $1,100,000, is located in a desirable and quiet neighborhood in West Concord adjacent to conservation land, which provides this property with a buffer and a favorable view. Comparable Sale 2's house is superior in quality and construction compared to the subject property's home, and it contains an additional one-half bathroom, an additional garage bay, a two-bay carport, and an in-ground pool, spa, and fence. Although this comparable sale property's lot is smaller than the subject property's parcel, it is all uplands and therefore has good utility. After applying adjustments, Mr. Avery determined an adjusted sale price for this comparable property and an indicated value for the subject property of $988,800.
Mr. Avery testified that Comparable Sale 3, 91 Rollingwood Lane, which sold in March, 2006 for $999,000, is, like Comparable Sale 2, located in West Concord. Comparable Sale 3, however, is situated in the far southern part of Concord, which is inferior to the subject property's location. He considered this comparable sale property's house to be in superior condition to the subject property's home, and noted that it has an additional bathroom and fireplace, as well as a superior finished basement. Mr. Avery further observed that Comparable Sale 3 has one fewer bedroom than the subject property's home, has inferior amenities, and lacks central air conditioning. After applying adjustments, Mr. Avery determined an adjusted sale price for this comparable property and an indicated value for the subject property of $1,000,850.
The following table summarizes Mr. Avery's sales-comparison analysis pertaining to Comparable Sales 1, 2, and 3.
Subject Sale 1 Sale 2 Sale 3
Data
&
Adjustments (Adjust.) 531
Monument Street 155
Monument Street 88
Indian Pipe Lane 91 Rollingwood Lane

Proximity to Subj. (Miles) N/A 0.71 S 3.95 SW 2.91 SW
Sales Price ($) N/A 1,150,000 1,100,000 999,000
Sale Date/Time N/A 11/22/2006 07/17/2006 03/01/2006
Site (Acres) 2.42 - Wet 0.33 1.33 2.78
View Neighborhood Superior Superior Superior
Design & Appeal Contemporary Antique Ranch Contemporary Contemporary
Construct. Quality Average Similar Similar Similar
Age (Years) 40 92 36 46
Rooms/Bedrooms/Baths 7/3/2.5 8/3/3.0 7/3/3.0 7/2/3.5
Living Area (SF)* 1,769 2,470 2,643 2,672
Basement Finished Unfinished Finished Finished
Functional Utility Adequate Adequate Adequate Adequate
Heating/Cooling FHW/CC FHA/CC HWBB/CAC HWBB/None
Energy Efficiency Standard Standard Standard Standard
Garage/Carport 2 Under 2 Attached 3 Under/2 2 Attached
Porch/Patio/Deck 0/1/1 1/1/1 1/0/1 0/1/0**
Fireplaces 2 1 2 3
Fence, Pool, Spa None None All 3 None

Adjustments: Superior (-)
($) Inferior (+)
Sale Date/Time 01/01/2007 No adjust. No adjust. No adjust.
Location Residential -50,000 +100,000 +150,000
Site 2.42 - Wet +15,000 No adjust. -15,000
View Neighborhood -15,000 -30,000 -30,000
Condition Average -65,000 -115,000 -65,000
Rooms/Bedrooms/Baths 7/3/2.5 -2,500 -2,500 +5,000
Living Area (SF)* 1,769 -35,050 -43,700 -45,150
Basement Finished +10,000 No adjust. -5,000
Heating/Cooling FWH/CAC No adjust. No adjust. +7,500
Energy Efficiency Standard No adjust. No adjust. No adjust.
Garage/Carport 2 Under No adjust. -10,000 No adjust.
Porch/Patio/Deck 0/1/1 -7,500 No adjust. +2,000
Fireplaces 2
Fence, Pool, Spa None No adjust. -10,000 No adjust.
Net Adjust. ($) N/A -147,000 -111,200 +1,850

Adjust. Sales Price ($) N/A 1,002,450 988,800 1,000,850
* Above grade
** Also has a greenhouse
Mr. Avery testified that Comparable Sale 4, 201 Independence Road, which sold in May, 2006 for $875,000, is located in an older neighborhood, just off of Lexington Road east of the downtown, which is superior to the West Concord neighborhoods, but not as desirable as along Monument Street, where the subject property is located. He further observed that this comparable sale property's house is similar in quality and construction to the subject property's home, but it has one fewer bedroom, one fewer one-half bathroom, one fewer fireplace, an unfinished, as opposed to a finished, basement, no central air-conditioning, and only a single-car garage. Mr. Avery also noted that Comparable Sale 4's view of its neighborhood is superior to the subject property's but its parcel has a similar utility to the subject property's because of its steep slope in the backyard. After applying adjustments, Mr. Avery determined an adjusted sale price for this comparable property and an indicated value for the subject property of $988,300.
Mr. Avery testified that Comparable Sale 5, 125 Hugh Cargill Road, which sold in June, 2006 for $865,000, is in a neighborhood just off of Lowell Road, which has become an increasingly popular neighborhood, but not as desirable as the subject property's Monument Street location. He further observed that this comparable sale property has a similarly sized lot to the subject property's parcel, but its parcel has greater utility. Mr. Avery found that Comparable Sale 5's woodlands and neighborhood views are superior to the subject property's neighborhood view. He also noted that this comparable sale property's house has one fewer one-half bathroom and one fewer fireplace than the subject property's home, and it also has no central air-conditioning, inferior energy efficiency, inferior exterior amenities, and an unfinished, as opposed to a finished, basement. After applying adjustments, Mr. Avery determined an adjusted sale price for this comparable property and an indicated value for the subject property of $1,011,350.
The following table summarizes Mr. Avery's sales-comparison analysis pertaining to Comparable Sales 4 and 5.

Subject Sale 4 Sale 5

Data
&
Adjustments (Adjust.) 531
Monument Street 201 Independence Road 125
Hugh Cargill Road

Proximity to Subj. (Miles) N/A 1.22 SE 0.99 NW
Sales Price ($) N/A 875,000 865,000
Sale Date/Time N/A 05/01/2006 06/20/2006
Site (Acres) 2.42 - Wet 2.38 - Steep 2.5
View Neighborhood Superior Superior
Design & Appeal Contemporary Cape Cape
Construct. Quality Average Similar Similar
Age (Years) 40 65 54
Rooms/Bedrooms/Baths 7/3/2.5 6/2/2.0 7/4/2.0
Living Area (SF)* 1,769 1,653 1,892
Basement Finished Unfinished Unfinished
Functional Utility Adequate Adequate Adequate
Heating/Cooling FHW/CC HWBB/None ELBB/None
Energy Efficiency Standard Standard Inferior
Garage/Carport 2 Under 1 Detached 2 Attached
Porch/Patio/Deck 0/1/1 Porch Porch
Fireplaces 2 1 1
Fence, Pool, Spa None None None

Adjustments: Superior (-)
($) Inferior (+)
Sale Date/Time 01/01/2007 No adjust. No adjust.
Location Residential +100,000 +100,000
Site 2.42 - Wet No adjust. -15,000
View Neighborhood -15,000 -7,500
Condition Average -15,000 +50,000
Rooms/Bedrooms/Baths 7/3/2.5 +12,500 -7,500
Living Area (SF)* 1,769 +5,800 -6,150
Basement Finished +10,000 +10,000
Heating/Cooling FWH/CAC +7,500 +7,500
Energy Efficiency Standard No adjust. +7,500
Garage/Carport 2 Under +5,000 No adjust.
Porch/Patio/Deck 0/1/1 No adjust. +5,000
Fireplaces 2 +2,500 +2,500
Fence, Pool, Spa None No adjust. No adjust.
Net Adjust. ($) N/A +113,300 +146,350

Adjust. Sales Price ($) N/A 988,300 1,011,350
* Above grade

Based on his sales-comparison analysis, which produced adjusted sales prices and indicated values ranging from $988,300 to $1,011,350, and his decision in his reconciliation to give the most weight to Comparable Sales 1, 2, and 3 and the least weight to Comparable Sale 5, Mr. Avery estimated that the subject property's fair cash value was $1,000,000 as of January 1, 2007, the relevant assessment date, or $14,400 less than its assessment.
After considering all of the evidence, the Board found that each of the appellant's valuation methods contained substantial flaws which seriously undermined the accuracy of the values derived from them. First, with respect to the appellant's comparable-sales analysis, the Board found that none of his five purportedly comparable properties selected for comparison with the subject property was from the subject property's Monument Street neighborhood and two of these properties were of a totally different building style. In addition, the Board found that another two of the appellant's purportedly comparable properties were situated substantially farther from the town center than the subject property and those same two properties had significantly smaller parcels. The Board also found that most of these properties contained different numbers of bedrooms or bathrooms than the subject property had and the appellant neglected to adjust for these differences. The appellant also failed to compare and adjust for other characteristics of the purportedly comparable properties that differed from those of the subject property, including important features such as: building amenities; garages; construction quality; functional utility; and utility systems. The Board further found that with one minor exception, the appellant only applied a locational adjustment thereby neglecting to account for these readily observable differences between the purportedly comparable properties and the subject property.
Moreover, the Board found that the appellant did not demonstrate that the locational adjustments or factors which he applied were reasonable and precise. The appellant developed his "location adjustment factor" for each of his purportedly comparable properties by comparing the sale prices of three properties from what he deemed to be the subject property's neighborhood to the sale prices of three supposedly similar properties located in what he deemed to be his purportedly comparable properties' neighborhood. The Board found that the appellant's failure to apply adjustments to these sale prices to account for differences between properties from the subject property's neighborhood and properties from his purportedly comparable properties' neighborhood rendered this mathematical exercise imprecise and unpersuasive.
Therefore, for all of these reasons, the Board found that the appellant's comparable-sales analysis was seriously flawed and, as a result, did not provide the Board with reliable and accurate estimates of the subject property's fair cash value for fiscal year 2008.
Second, the Board found that the appellant's "repeat sale data analysis" was flawed. In this analysis, the appellant valued the subject property by applying the appreciation of one purportedly comparable property between 1988 and 2007 to the subject property's purchase price in 1988. The Board found, however, that this purportedly comparable property differed from the subject property in several material respects, including its lot size, condition, and various unique features, and it was not located in the subject property's neighborhood. The appellant failed to establish comparability and to show that appreciation among Concord neighborhoods for this time period was equivalent. The Board also found that the appellant relied on insufficient data to support his appreciation conclusion. "An adjustment derived from a single pair of sales is not necessarily indicative, just as a single sale does not necessarily reflect market value." Appraisal Institute, The Appraisal of Real Estate 317 (13th ed. 2008). "When few [] pairings are available, the appraiser should use other analytical procedures or secondary data." Ibid. The Board further found that, under the circumstances present in this appeal, the appellant's "repeat sale data analysis" appeared to be a more appropriate technique for mass appraisal purposes and for generating generalizations about property in an area, than for an accurate estimate of the fair cash value for a specific property in a particular location. For these and other reasons, the Board found that the appellant's "repeat sale data analysis" was seriously flawed for the purpose to which the appellant applied it and, as a result, did not provide the Board with reliable and accurate estimates of the subject property's fair cash value for fiscal year 2008.
Third, the Board found that the appellant's regression analysis, like his two previous analyses, was also seriously flawed. For this approach, the appellant used seven 2006 sales of residential property on or just off of Monument Street. With one exception, however, all of these properties had much larger effective areas than the subject property -- double, triple, or even quadruple the subject property's area -- and even the lone exception was still approximately one-third larger. The Board found that the appellant's regression analysis did not incorporate enough data about homes equivalent to or smaller in size than the subject property, and was, therefore, unreliable for the purpose to which the appellant applied it. In addition and under the circumstances present in this appeal, the Board found that this technique, which in this instance produced a correlation coefficient of 0.92, is more appropriately used for mass appraisal purposes and for generating generalizations about property within an area, and not for an accurate estimate of the fair cash value for a specific property. "Regression modeling is often the logical choice for tax assessment when the alternative is to appraise each property individually and resource constraints prohibit doing so." The Appraisal of Real Estate at 612. For these and other reasons, the Board found that the appellant's regression analysis was flawed and, as a result, did not provide the Board with a reliable and accurate enough estimate of the subject property's fair cash value for fiscal year 2008.
Fourth, the appellant submitted a letter from a real estate agent describing "several limiting factors affecting the fair cash value of [the subject property]," which would restrain its sale price to an amount in "the $800,000 range" as of May, 2009. The Board found that the realtor's opinion was for a date almost 2-1/2 years beyond the fiscal year 2008 assessment date of January 1, 2007, and without evidence of the market conditions for that time period, was unreliable. In addition, the Board found that the realtor did not provide any supporting data or information to substantiate her conclusions and because she did not testify, the Board was not able to gauge her credibility. For these and other reasons, the Board found that the real estate agent's letter submitted by the appellant did not provide the Board with reliable or credible information pertaining to the subject property's fair cash value for fiscal year 2008.
The Board also found that the sales-comparison analysis submitted by the assessors' real estate valuation expert, Mr. Avery, was reliable and credible. The Board found that his selection of comparables and his emphasis on the indicated values derived from his first three comparable sales were reasonable under the circumstances. The Board also found that these three properties were the most comparable to the subject property and that the items that Mr. Avery considered for adjustment and the adjustments that he applied for these items were reasonable, as well. The Board further found that his $1,000,000 estimate of the subject property's fair cash value for fiscal year 2008 was credible and well-substantiated and it adequately considered the condition of the subject property as of January 1, 2007.
Based on these findings, the Board ultimately found that the subject property was overvalued for fiscal year 2008 and its fair cash value as of the January 1, 2007 assessment date was $1,000,000. Accordingly, the Board decided this appeal for the appellant and granted a tax abatement in the amount of $156.69, which includes the CPA tax.

OPINION
The assessors are required to assess real estate at its fair cash value. G.L. c. 59, § 38. Fair cash value is defined as the price on which a willing seller and a willing buyer in a free and open market will agree if both of them are fully informed and under no compulsion. Boston Gas Co. v. Assessors of Boston, 334 Mass. 549, 566 (1956).
The appellant has the burden of proving that the property has a lower value than that assessed. "'The burden of proof is upon the petitioner to make out its right as [a] matter of law to [an] abatement of the tax.'" Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974) (quoting Judson Freight Forwarding Co. v. Commonwealth, 242 Mass. 47, 55 (1922)). "[T]he [Board] is entitled to 'presume that the valuation made by the assessors [is] valid unless the taxpayer[] . . . prov[es] the contrary.'" General Electric Co. v. Assessors of Lynn, 393 Mass. 591, 598 (1984) (quoting Schlaiker, 365 Mass. at 245).
In appeals before this Board, a taxpayer "'may present persuasive evidence of overvaluation either by exposing flaws or errors in the assessors' method of valuation, or by introducing affirmative evidence of value which undermines the assessors' valuation.'" General Electric Co., 393 Mass. at 600 (quoting Donlon v. Assessors of Holliston, 389 Mass. 848, 855 (1983)).
In the present appeal, the appellant tried to demonstrate that the subject property was overvalued for fiscal year 2008 by offering the testimony of his spouse and a self-prepared valuation report that contained information pertaining to the subject property, as well as comparable-sales, "value-trend" or "repeat sale data," and regression analyses. He also submitted into evidence, without objection, a letter from the sales associate who sold the subject property to the appellant, which discusses several "limiting factors affecting the fair market value of [the subject property]."
With respect to the appellant's "value trend" or "repeat sale data" analysis, which attempted to value the subject property as of January 1, 2007 by applying the appreciation attributable to a purportedly comparable property, located in a different neighborhood, to the subject property's purchase price in 1988, the Board found that this method was flawed because, among other reasons, the appellant failed to show comparability between the two properties and also failed to demonstrate that appreciation between the two Concord neighborhoods for the relevant time period was equivalent. The Board further found that the appellant relied on insufficient data in attempting to prove this point. Additionally, the Board found that, under the circumstances present in this appeal, this particular approach for valuing property is more appropriately used for mass appraisal purposes and for generating generalizations about property in a given area as opposed to developing an accurate estimate of the fair cash value for a specific property in a particular area. Accordingly, the Board found and ruled that this method did not provide the Board with a reliable and accurate estimate of the subject property's fair cash value for fiscal year 2008.
With respect to the appellant's regression analysis, the Board found that it too was flawed because, among other reasons, it did not incorporate enough data about homes equivalent in size to or smaller than the subject property's. In addition, there was insufficient evidence to equate the value conclusions drawn by the appellant using this method to the subject property. The Board also found that, like the previous method, this technique is more appropriately used for mass appraisal purposes and for drawing generalizations about property within an area, but not for developing an accurate estimate of the fair cash value of a specific property. Accordingly, the Board found and ruled that the appellant's regression analysis did not provide the Board with reliable and accurate enough estimates of the subject property's fair cash value for fiscal year 2008.
With respect to the realtor's letter discussing "several limiting factors affecting the fair cash value of [the subject property]," which would restrain its sale price to an amount in "the $800,000 range" as of May, 2009, the Board found that the realtor's opinion was for a date almost 2-1/2 years beyond the fiscal year 2008 assessment date of January 1, 2007, and without evidence of market conditions for that time period, was unreliable. Moreover, the Board found that the realtor did not provide any supporting data or information to substantiate her conclusions and because she did not testify, the Board was not able to gauge her credibility. For these reasons, among others, the Board found and ruled that the information and opinions contained in the real estate agent's letter submitted into evidence by the appellant did not provide the Board with reliable or credible information pertaining to the subject property's fair cash value for fiscal year 2008.
With respect to the appellant's comparable-sales analysis, the Board recognized that actual sales generally "furnish strong evidence of market value, provided they are arm's-length transactions and thus fairly represent what a buyer has been willing to pay for the property to a willing seller." Foxboro Associates v. Assessors of Foxborough, 385 Mass. 679, 682 (1982); see also New Boston Garden Corp. v. Assessors of Boston, 383 Mass. 456, 469 (1981); First National Stores, Inc. v. Assessors of Somerville, 358 Mass. 554, 560 (1971). Sales of comparable realty in the same geographic area and within a reasonable time of the assessment date may contain relevant data and information for determining the value of the property at issue. See McCabe v. Chelsea, 265 Mass. 494, 496 (1929). "A major premise of the sales comparison approach is that an opinion of the market value of a property can be supported by studying the market's reaction to comparable and competitive properties." Appraisal Institute, The Appraisal of Real estate 297 (13th ed., 2008).
When comparable sales are used, however, allowance must be made for various factors which would otherwise cause disparities in the comparable prices. See Pembroke Industrial Park Co., Inc. v. Assessors of Pembroke, Mass. ATB Findings of Fact and Reports 1998-1072, 1082. "Adjustments for differences in the elements of comparison are made to the price of each comparable property . . . . The magnitude of the adjustment made for each element of comparison depends on how much that characteristic of the comparable property differs from the subject property." The Appraisal of real estate at 322.
The Board found that the appellant's comparable-sales analysis neglected to adequately compare and adjust for many of his purportedly comparable properties' characteristics and features that differed from those of the subject property. The Board found that with one minor exception, the appellant only applied a locational adjustment and failed to account for other readily observable differences between his purportedly comparable properties and the subject property. Moreover, the Board found that the appellant similarly developed his "location adjustment factors" without accounting for differences between the properties that he used, thereby rendering his mathematical exercise imprecise. For these, as well as other reasons, the Board found and ruled that the appellant's comparable-sales analysis was seriously flawed and, as a result, did not provide the Board with reliable and accurate estimates of the subject property's fair cash value for fiscal year 2008.
On the other hand, the sales-comparison analysis introduced by the assessors' real estate valuation expert contained reasonably comparable properties to which he applied appropriate adjustments to account for their differences with the subject property resulting in indicated values that supported a fair cash value of $1,000,000. See, e.g., Graham v. Assessors of West Tisbury, Mass. ATB Findings of Fact and Reports 2007-321, 401 (recognizing that comparable-sales information is often the best available means for proving a property's fair cash value), aff'd, 73 Mass. App. Ct. 1107 (2008).
"The board [is] not required to believe the testimony of any particular witness but [may] accept such portions of the evidence as appear to have the more convincing weight." Assessors of Quincy v. Boston Consol. Gas Co., 309 Mass. 60, 72 (1941). "The credibility of witnesses, the weight of evidence, and inferences to be drawn from the evidence are matters for the board." Cummington School of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 605 (1977). Based on the evidence presented in this appeal, the Board selected the most credible and probative evidence in finding and ruling that the assessors had overvalued the subject property and also in finding and ruling that the assessors' real estate valuation expert had appropriately supported his $1,000,000 fair cash value estimate for the subject property for fiscal year 2008 with credible comparable-sales data.
On this basis, the Board decided these appeals for the appellant and granted a tax abatement in the amount of $156.60, including the CPA tax.

APPELLATE TAX BOARD

By: ____ ______
Thomas W. Hammond, Jr., Chairman

A true copy,

Attest: _________________________
Clerk of the Board

This amount does not include the additional $147.04 assessment under the town's Community Preservation Act ("CPA"), which brought the total tax to $11,021.41.
General Laws c. 59, § 57C provides, in pertinent part, that: "In the event the actual tax bills are not mailed by December thirty-first, then upon the establishment of the tax rate there shall be a single actual bill due and payable on May first, or thirty days after the date of mailing, whichever is later."
General Laws c. 59, § 59, provides, in pertinent part, that:
A person upon whom a tax has been assessed . . . , if aggrieved by such tax, may, . . . on or before the last day for payment, without incurring interest in accordance with the provisions of . . . section fifty-seven C, of the first installment of the actual tax bill issued upon the establishment of the tax rate for the fiscal year to which the tax relates, apply in writing to the assessors . . . for an abatement thereof.

In his abatement application and at the hearing, the appellant estimated the subject improvement's gross living area at 2,417 and 2,404 square feet, respectively. His spouse concurred with this latter estimate during her presentation. They did not, however, substantiate or explain the difference between their estimates. The assessors' real estate valuation expert based his estimate of the subject improvement's gross living area of 2,353 square feet on his own inspection and measurements, as well as floor plans filed with the town's Building Department and the assessors' records. The Board adopted the gross area suggested by the assessors' real estate valuation expert because he based it on his actual measurements and those submitted to town officials by or on behalf of the appellant.
The appellant estimated the living space on the subject improvement's main floor at 1,771 square feet. The Board, for reasons previously articulated, adopted the measurement of the assessors' real estate valuation expert, but considered this two-square-foot discrepancy to be de minimis.
The appellant also used this property in his comparable-sales analysis, but described some of its features differently than Mr. Avery did. To the extent that the descriptions differ, the Board adopted Mr. Avery's because he inspected at least the outside of the property and provided the Board with photographs substantiating his depiction.


ATB 2010-629

Stein B. Jacobsen v. Board of Assessors of the Town of Concord (July 9, 2010)

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