ILNews

Mobile home park's occupancy rate not enough to reduce property assessment

Back to TopCommentsE-mailPrintBookmark and Share

A low occupancy rate alone did not provide the owner of a mobile home community with the evidence it needed to get its property assessment reduced.  

The Indiana Tax Court affirmed the final determination by the Indiana Board of Tax Review in Indiana MHC, LLC v. Scott County Assessor, 39T10-1009-TZ-52. The high court ruled because Indiana MHC’s income capitalization approach lacked probative value, the Indiana Board of Tax Review was correct in determining that the property owner failed to prove its 2007 real property assessment was incorrect.

Indiana MHC, owner of Amberly Pointe, a manufactured home community, was successful in getting the Scott County Property Tax Assessment Board of Appeals to lower the original assessment of $5.4 million. However, believing the reduced assessment of $3.38 million was still too high, the property owner appealed to the Indiana board.

At an administrative hearing, Indiana MHC asserted that because only 85 pads of Amberly Pointe’s 205 pads were rented and generating income between 2005 and 2008, only the rented pads had value for purpose of the 2007 assessment. In addition, the property owner also claimed that about 2.6 acres of the community’s 33 acres had no value because the land, as green space, could not generate any income.

Using the income capitalization approach, Indiana MHC contended its property had a value of $1,075,692.  

The Indiana board concluded that because the property owner’s income capitalization approach failed to take into account any market data whatsoever, it lacked probative value.

In affirming the board’s determination, the Tax Court explained the requirements for applying the income capitalization approach. Namely, the property owner must not only examine the historical and current income, expenses, and occupancy rates for the subject property but the income, expenses and occupancy rates of comparable properties in the market as well.

The court found that Indiana MHC failed to comply with generally accepted appraisal principle because it did not consider the occupancy rates of comparable properties in the market. In fact, the evidence indicates that Amberly Pointe’s low occupancy rate of 40 percent was actually the anomaly in the market place.

Consequently, the Tax Court ruled that based on Indiana MHC’s failure to examine, analyze and reconcile its low occupancy rate in light of the much higher occupancy rates prevalent in the market place, the Indiana board did not err in finding that the property owner’s income capitalization approach lacked probative value.

 


 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. Two cops shot execution style in NYC. Was it first amendment protest, or was it incitement to lawlessness? Some are keeping track of the body bags: http://www.breitbart.com/big-government/2014/12/13/al-sharpton-leads-thousands-in-saturday-march-on-washington-dc/

  2. From the MCBA: “This situation is not just about the death of Michael Brown, but the thousands of other African-Americans who are disproportionately targeted and killed by police officers.” The association said it was “saddened and disappointed” by the decision not to indict Ferguson police officer. HOPING that the MCBA will denouce the execution style killig of two NYC police officers this day, seemingly the act of one who likewise believes that the police are targeting blacks for murder and getting away with it. http://www.mediaite.com/online/two-nypd-cops-fatally-shot-in-ambush-in-brooklyn/ Pray this violence soon ends, and pray it stays far away from Indiana.

  3. "Am I bugging you? I don't mean to bug ya." If what I wrote below is too much social philosophy for Indiana attorneys, just take ten this vacay to watch The Lego Movie with kiddies and sing along where appropriate: https://www.youtube.com/watch?v=etzMjoH0rJw

  4. I've got some free speech to share here about who is at work via the cat's paw of the ACLU stamping out Christian observances.... 2 Thessalonians chap 2: "And we also thank God continually because, when you received the word of God, which you heard from us, you accepted it not as a human word, but as it actually is, the word of God, which is indeed at work in you who believe. For you, brothers and sisters, became imitators of God’s churches in Judea, which are in Christ Jesus: You suffered from your own people the same things those churches suffered from the Jews who killed the Lord Jesus and the prophets and also drove us out. They displease God and are hostile to everyone in their effort to keep us from speaking to the Gentiles so that they may be saved. In this way they always heap up their sins to the limit. The wrath of God has come upon them at last."

  5. Did someone not tell people who have access to the Chevy Volts that it has a gas engine and will run just like a normal car? The batteries give the Volt approximately a 40 mile range, but after that the gas engine will propel the vehicle either directly through the transmission like any other car, or gas engine recharges the batteries depending on the conditions.

ADVERTISEMENT