Property values spike in Merced County

Merced County’s property value increase of 9.3 percent to $19.5 billion ranked as the second highest increase in California from the same time last year.

Stanislaus County property values had the highest year-over-year increase, rising 11.4 percent to $39.7 billion for the 2014-15 tax year, and San Joaquin County’s 8.8 percent increase to $61 billion was the fourth highest percentage gain among California’s 58 counties.

Assessed property values statewide rose 6.1 percent to $4.9 trillion, according to data released Tuesday by the state Board of Equalization.

“Higher property values are an encouraging sign that California’s economic recovery is finally gaining traction throughout our state,” Board of Equalization member George Runner said. “This is good news, especially for homeowners still underwater and workers who still need jobs.”

Increasing values also mean increasing property taxes. Homeowners were mailed their tax bills this month, and the first payment on those bills is due Dec.10.

There’s no secret about why Northern San Joaquin Valley property values rose so much compared to other parts of the state: It’s because they plummeted so far when the housing market crashed.

Despite this year’s big gains, the region’s property values lag behind what they were before the Great Recession and the foreclosure crisis.

Merced County’s values reached $20.5 billion during the 2007-08 tax year. Values then plunged down to $16.6 billion through 2011-12.

“The housing market has recovered, though it’s a little softer than it was even six or eight months ago,” Merced County Assessor Barbara Levey said. “It has recovered, so our values are showing that.”

The same way that commercial property values followed residential values over the Great Recession cliff, she said, commercial property values are expected to follow the residential ones as they rise. Agricultural land values have stayed strong throughout, she said.

Terry Ruscoe, owner of Merced Yosemite Realty in Merced, said Merced’s property values are being pushed up by continued interest from Bay Area investors and having many more homes in escrow compared to a year ago. “The market’s moving and the market’s pushing prices up,” he said. “This is good for a lot of folks.”

He said as prices go up, fewer homeowners are underwater and fewer homes foreclosed. Hurting the markets most, he said, are buyers unable to qualify because of bad credit from past home purchases and banks that are gun-shy to loan money.

Anything that reinvigorates home-buying and consumer confidence can be good news for Merced, he said, including the unemployment rate (10.4 percent), which continues to dip from year to year, according to Employment Development Department numbers this month.

“It’s good to see the market returning to a positive norm,” he said. “Hopefully our commercial end will continue to improve, because jobs are going to be the primary catalyst for values in Merced.”

Of California’s 58 counties, 55 posted year-over-year increases in assessed values this year. Some of those gains, however, were fairly small.

Tuolumne County’s property values rose just 2.7 percent to $6.3 billion; Calaveras County increased 6.1 percent to $6 billion; and Mariposa County edged up only 0.7 percent to $2.1 billion.

This story was originally published October 21, 2014 at 8:18 PM with the headline "Property values spike in Merced County."