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

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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.

 


 

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  1. As one of the many consumers affected by this breach, I found my bank data had been lifted and used to buy over $200 of various merchandise in New York. I did a pretty good job of tracing the purchases to stores around a college campus just from the info on my bank statement. Hm. Mr. Hill, I would like my $200 back! It doesn't belong to the state, in my opinion. Give it back to the consumers affected. I had to freeze my credit and take out data protection, order a new debit card and wait until it arrived. I deserve something for my trouble!

  2. Don't we have bigger issues to concern ourselves with?

  3. Anyone who takes the time to study disciplinary and bar admission cases in Indiana ... much of which is, as a matter of course and by intent, off the record, would have a very difficult time drawing lines that did not take into account things which are not supposed to matter, such as affiliations, associations, associates and the like. Justice Hoosier style is a far departure than what issues in most other parts of North America. (More like Central America, in fact.) See, e.g., http://www.theindianalawyer.com/indiana-attorney-illegally-practicing-in-florida-suspended-for-18-months/PARAMS/article/42200 When while the Indiana court system end the cruel practice of killing prophets of due process and those advocating for blind justice?

  4. Wouldn't this call for an investigation of Government corruption? Chief Justice Loretta Rush, wrote that the case warranted the high court’s review because the method the Indiana Court of Appeals used to reach its decision was “a significant departure from the law.” Specifically, David wrote that the appellate panel ruled after reweighing of the evidence, which is NOT permissible at the appellate level. **But yet, they look the other way while an innocent child was taken by a loving mother who did nothing wrong"

  5. Different rules for different folks....

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