Welcome! This blog tracks the real estate market in the Central Shenandoah Valley, featuring market data and analysis, an exploration of common buying and selling questions, and candid commentary on all things real estate.
If you are interested in discussing any of the topics on this blog, or the details of your specific real estate situation, call or e-mail me!
Government
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Concept Plan of New Harrisonburg High School |
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 Click on the links below to check out a concept plan dated May 31, 2019 for the new Harrisonburg High School, which seems to feature:
Follow updates on this new high school here. | |
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Comparing Monthly Property Tax Bills Between Harrisonburg and Rockingham County |
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 Getting a bit further into this topic -- yesterday I was looking only at the changes in the property tax rates in the City and County -- as shown here. Today (thanks for the idea, Mike) I looked at how a monthly property tax bill has changed over the past decade for a median priced home in the City and County. To be clear, this analysis uses:
As shown above, it has become more expensive (16%) to pay property taxes on a home in the City of Harrisonburg as compared to a similarly priced (assessed) home in Rockingham County. Now -- does this cause anyone to move from the City to the County? Or does it cause anyone new to the area to buy in the County instead of the City? Not necessarily - or at least that has not been my experience in working with buyers and sellers in the past ten (+) years. | |
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Real Estate Tax Rates Finalized in Harrisonburg, Rockingham County |
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 The real estate tax rates have been finalized for the 2019-20 fiscal year...
For some context...
For an even broader context...
And to translate it into monthly costs...
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Thoughts and Questions on Short Term Rentals in the City of Harrisonburg |
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 More great reporting over at The Citizen about short term rentals...
And a few prior articles...
And to follow that recap, some thoughts and questions... Does approving a Short Term Rental remove a property from the local housing stock? Not really - or not most of the time? Most of the Short Term Rental applications have been from owners who live in their home and want to offer a portion of their home as a short term rental option. So - those properties aren't being removed from the local housing stock - the owners still live there. Further, the approval of a non owner occupied property as a Short Term Rental wouldn't remove a property from the "purchasable housing stock" since the owner is presumably currently renting it to a long term tenant. Technically, a property owner could decide to stop renting a house to long term tenants and start renting it only to short term tenants -- thus making it such that most occupants of the house would not be local residents, but just those passing through. In that situation it would, in some ways, be moving the property from the local housing stock to the "local hotel stock" - if that were a thing. This (converting a home from being occupied by the owner or a long term tenant to being occupied only by short term tenants) doesn't seem to be the majority of what is being proposed or considered - and my general sense (not scientific or data driven, I know) is that there is only so much of a market of would-be tenants for short term rental properties. If one hundred local property owners moved out of their homes, were approved to use them as short term rentals, and listed them on AirBNB, I don't think that all, or most or would be pleased with the rental demand from short term tenants. If one Short Term Rental is approved on a street or in a neighborhood will lots of other property owners follow suit and apply to become short rentals? Not really - or not most of the time? I think most folks who own and live in their homes in Harrisonburg enjoy living in their homes, probably by themselves. I don't think that the ability of one home out of 50 (in a hypothetical neighborhood) is going to cause more and more property owners to either take in short tenants to live with them, or to move out of their homes and start renting them to short term tenants. Will investors start buying up properties in Harrisonburg as short term rentals? Probably not, or not in large numbers? I don't think there is an untapped demand by short term tenants that would reward those investors with frequently rented short term rental properties. Yes, it is technically true that renting a property to 100 tenants for short terms instead of one tenant for the entire year is almost certainly going to be more profitable - but I just don't think there is that much demand by short term tenants. As a side note - there are plenty of localities where ordinances limiting short term rentals do not exist. I tend to think that investors would be more likely to invest in a property where short term rentals are not regulated before they'd invest in a community where there are somewhat restrictive regulations in place. Will the City's new Short Term Rental policy increase or decrease the number of City properties that are being used as short term rentals? To me, this is one of the more interesting questions. Property owners in the City have been operating short term rentals in the City for quite some time now (5+ years?) without actually having the legal ability to do so. Most of the concerns above seem to be regarding the hypothetical possibility that more and more and more properties will be come short term rentals. I tend to think that we won't see a large shift in the number of properties being used as short term rentals when comparing (for example) 2018 and 2020. Of the folks using their homes as short term rentals prior to these regulations:
Those four (non-exact, non-numerical) changes above would seem likely to result in a net decline in the number of short term rentals -- and moving forward, property owners would seem to be less likely to want to use their property as a short-term rental as there is now a higher barrier to entry in the form of an application fee and several months of processes and meetings. Should most Short Term Rental applications be approved? Not necessarily? City Staff, Planning Commission and City Council are looking at each application through many lenses to understand how each property being used as a short term rental would affect surrounding property owners, the neighborhood, etc. I think all of those property-specific perspectives are valuable and I am glad to see the thoughtful process being used for deciding whether to approve short term rentals. The broader thoughts of "maybe we shouldn't approve any or many short term rentals because of how it could have a large impact on our local housing market and housing stock" (my summary, not a quote) are a bit more difficult for me to agree with - at least given my understanding of the short term rental market as of today. Am I completely wrong to not be overly concerned about unintended consequences of approving many or most applications for short term rentals? Quite possibly! If lots of property owners decide they want to pursue using their property as a short term rental AND the City approves many or most or all of them AND there is an unexpectedly high demand from short term tenants -- then it is possible that there would be widespread negative unintended consequences. I'm not thinking this is likely - but I could be wrong. What are your thoughts? | |
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First Three Short Term Rentals Approved in Harrisonburg |
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 The City of Harrisonburg now regulates short term rentals -- and the first wave of applications have now made their way through the review process (City Staff, Planning Commission, City Council) and three properties have been approved by the City as short term rentals:
As context:
You can read more about this topic as follows...
As per the last article above... "All three permits were approved with conditions, including that the properties be the primary residence of the owner-operator, the owner-operator be present while renting out the space, and the owner-operator file a form guaranteeing that the "accommodation spaces" meet certain safety requirements, such as a door or window for immediate emergency exit to the outside." There are a pile of additional applications that will be reviewed over the next few months as we move towards August 1 when the enforcement of this new Short-Term Rental ordinance begins. | |
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Rockingham County Considers Creating Lake Shenandoah Stormwater Control Authority |
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 Rockingham County is proposing that a Stormwater Control Authority be created in the area shown above in blue. Learn more here. The link above takes us to some great FAQ's, which explain that...
This proposed Stormwater Control Authority would include all or part of the following areas:
Again, learn more about this proposal and process here. | |
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Mixed Use Development Proposed on Peach Grove Avenue |
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 The Harrisonburg City Council will hold a Public Hearing on May 14, 2019 at 7:00 PM on a variety of topics, including the potential rezoning of land on Peach Grove Avenue for the development of "The Residence and Shoppes at Peach Groves". UPDATE: The applicant has tabled the request until May 28. The public hearing will not take place on May 14.  Here are some key points to know based on the information packet provided during the Planning Commission meeting in April.
If you want to provide input on this potential rezoning for this potential development, attend the City Council meeting on May 14, 2019 at 7:00 PM. UPDATE: The applicant has tabled the request until May 28. The public hearing will not take place on May 14. | |
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Operating a Short Term Rental in the City of Harrisonburg |
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 After quite a long time (over a year?) of debating different paths for regulating short term rentals (such as through airBNB) the City of Harrisonburg has finally made a decision and set forth their official regulations. Lots (and lots) of information is can be found here, but let's review some of the key points to remember:
Again, you can find much more information here as well as links to additional information to get you started with registering your Short Term Rental. One interesting part of this new requirement is that we're now seeing somewhat more clearly where these Short Term Rentals are being operated. These are the property owners that have applied for Special Use Permits thus far, with a public hearing on each of them scheduled for May 8, 2019. The packet of information with context for these five applications, and staff recommendations is here.
You can track public hearings here. | |
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Real Estate Tax Rate Likely To Increase Slightly In Harrisonburg |
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 The City of Harrisonburg and Rockingham County are going through their annual budget process and while Rockingham County has proposed a budget that does not include any changes to the real estate tax rate, the City of Harrisonburg's proposed budget for next fiscal year requires a $0.01 increase in the real estate tax rate. Read more about the City's forthcoming budget via... | |
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The Two Things We Might Mean By Affordable Housing |
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 "We need more affordable housing in our area." I hear it regularly, and perhaps you do as well. But I think it's worth pointing out that when people say this they might mean two very different things... When talking within the context of folks buying homes -- "affordable housing" often means homes in a price range that makes them affordable for first time buyers in our market. That could mean "under $150K" for some folks, or even "under $200K" in some situations. But wait -- is a home that can be purchased for $145K (for example) an affordable housing option for everybody living in our community? Nope! Not at all. There are plenty of folks who can't afford the accompanying monthly payment, or don't have a downpayment, or don't have money for closing costs, or who wouldn't have savings if a home repair became necessary in the first year or two of homeownership. So, it seems there is another thing we might mean when we say we need "affordable housing" in our community - and that would be rental properties with a low enough monthly rental rate to be feasible for low income earners in our area to still have decent housing options. I think it is important for elected officials and other City and County staff to be thinking about how decisions that are made and policies that are set can encourage the development of affordable housing - but we'll need to make sure we're all on the same page about what kind of affordable housing we're encouraging - and perhaps they need to be two completely separate priorities. Encouraging the development of affordable housing for renters and affordable housing for buyers -- for lack of any better way to express it. Anyone have other thoughts on how to best describe or name these types of housing and the need for them in our community? | |
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67 Four Bedroom Townhouses on Lucy Drive Instead of 107 Apartments, Retail, and Office Space? |
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 The owner of two parcels on Lucy Drive applied for a rezoning in mid-2018 to allow for a mixed use development that was to include (4) three to four level buildings with retail and offices on the first level and apartments on the upper levels. The (107) proposed apartments were intended to be (57) four-bedroom apartments, (37) three-bedroom apartments, (10) two-bedroom apartments and (3) one-bedroom apartments. That proposal was denied by City Council after 90 people showed up in opposition to the project. Now, the owners/developers are back with a new proposal -- 67 four bedroom townhouses.  Here's the full packet of information that will be considered by the Harrisonburg Planning Commission this evening, Wednesday, March 13 at 7:00 PM. This property is zoned R-3, which allows for townhouses to be built -- but the zoning ordinance requires that each townhouse lot have frontage on a public street, and the owner is applying for a variance to allow 32 of the planned 67 townhouses to not have frontage on a public street. Basically, if all townhouses need to have frontage on a public street, they could only build half as many townhouses. If the City allows them to have a private street for access to the townhouses they can build many more (67?) townhouses on the same amount of acreage. In the information packet linked above you'll note that City staff points out that there have been quite a few townhouse developments approved in the past 20 years with private streets -- but almost all of those variances that were granted were for subdivisions that were conforming to the Comprehensive Plan's Land Use Guide and planned densities - while this land is intended (per the Comprehensive Plan) for "limited commercial use". Bottom line - City staff is recommending that the request for the variance (and thus the preliminary subdivision plat) be denied. If the Planning Commission makes a decision as to a recommendation to City Council at the meeting this evening, this proposal will then go before City Council on April 9 -- without a public hearing, since it is a request for a variance, not a rezoning. Read the Daily News Record article (from yesterday) about this topic here. | |
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What To Do If A Rezoning Sign Shows Up Next To Your House |
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 OK. Let's brainstorm...
Yeah, probably none of those. Now, some real suggestions...
City of Harrisonburg Planning Commission website: Rockingham County Planning Commission website: | |
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Rezoning Requested For 86 Condos on Boyers Road |
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 Randy Cosner (Cosner Investments, LLC) is requesting the rezoning of 5.9 acres of a 10 acre parcel on Boyers Road to allow for 86 condominiums to be built. The property is currently zoned A2, and the proposed zoning is Planned Multi-Family. This would allow for 86 condos with 1, 2 or 3 bedrooms, for a total of 186 bedrooms in four separate buildings surrounding common areas. The full rezoning request can be found here. Here's what the proposed site plan would look like...  Per the rezoning application, the development would be called Locust Grove Village and would "provide a unique living opportunity for those inclined toward the beneficial aspects of community and socialization in a rural setting." Here is a rendering of what the buildings might look like...  A few details from the developer's narrative include... "Specifically, Locust Grove Village will house no more than 86 individual condominiums containing a mixture of 1-, 2-, and 3-bedroom units. Units will be clustered into four buildings of 20-22 units apiece, with a majority of these units having a ‘townhouse' style and appearance. Building ‘corners' will be comprised of six condominium units served by a common entry and stairwell. Each pair of buildings will encircle a central green, with each townhouse-style condo having direct access through their own private courtyard. Half of the corner units will have balconies/courtyards that face the common green (interior), while the other half will face the exterior." "The central greens will be improved with tasteful landscaping (mixture of trees and shrubbery), paved walkways, a central gazebo, charcoal grills, and benches, intended to promote resident interaction and sense of community. If desired by residents, allowances will be made for community gardens, to be maintained by the residents themselves, and thereby promoting a sense of pride and ownership within the community. Pedestrian connectivity between the greens will be provided through walkways and a mid-block crosswalk through the parking area." "In sum, Locust Grove Village is intended to serve a growing desirability for attractive, communal living opportunities within a rural setting. Through emphasis of common areas and promotion of interaction between residents, Locust Grove Village will position itself as the premier condominium-based community within Rockingham County." The Rockingham County Planning Commission reviewed this rezoning request at their January 2019 meeting. Their main concerns, per the minutes, seemed to be:
The rezoning request was unanimously tabled at the Planning Commission meeting. We'll have to wait and see if the request will be reviewed and discussed again, but at this point these condos "might be" built -- because the rezoning has not yet been approved. | |
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Making Harrisonburg A Place Young Alums Can Call Home For Decades |
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 I recently lamented that most new housing that is being built is student housing or rentals -- as opposed to homes that can be purchased by homeowners. And the "why" is because of the highest and best use for development land... "So long as there are student housing, rental housing or mixed use developers willing to buy land at a high price/acre AND/OR as long as owners of development land are willing to hold out for that high price/acre -- then land is not likely to be sold to developers or builders at a price/acre that would allow them to build homes for buyers to buy." Katherine took it one step further (thanks Katherine!) to draw home the "so what" of my observation... "Students are a lucrative and seemingly inexhaustible market, but it's short-sighted not to give some thought to how we can keep more young alumni in the community after graduation. Attractive, affordable starter homes are a piece of this puzzle, as are businesses and services geared toward professionals rather than college students. (And good jobs are, too, of course.) Excessive catering to the student population will make Harrisonburg a town people "remember fondly," not one they call home for decades." I agree wholeheartedly with this sentiment -- I want Harrisonburg to be a town that young alums can call home for decades. As Katherine points out, this is not just about housing - but housing is certainly a big part of it. It is not immediately clear what this could / should mean for the City of Harrisonburg -- but I do think we could look back 10 years from now and lament the fact that there weren't enough new developments built to allow for young alums to settle into jobs, buy their first home, and start establishing this as their home for decades. | |
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Harrisonburg, The City With The Planned Future, Plans Their Future |
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 City Council members and top City administrators and planners invested time in planning a future for the City of Harrisonburg at a three day retreat last weekend, with an eye towards Harrisonburg 20 years from now -- in 2039. That vision includes establishing Harrisonburg as the "capital of the Shenandoah Valley". Extensive conversations took place about education (including the new high school) and a comprehensive housing plan (including affordable housing and homelessness). Read much, much more about the retreat, conversations, outcomes and priorities over at The Citizen... If you care about the future of the City of Harrisonburg, read the article above, and give some thought to how you can be an active part of making the future of Harrisonburg brighter. | |
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The Latest on Possible Harrisonburg Short Term Rental Regulations |
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 As reported in last week's Daily News Record, the City of Harrisonburg is continuing to discuss if they should try to better regulate short term rentals and if so, how. The lay of the land in Harrisonburg currently seems to be...
And so, the discussions continue -- and are likely to continue to continue -- as there does not seem to be a neat and tidy, balanced solution to this issue. Maybe there will be new regulations in 2019 that will allow or prohibit or limit or regulate short term rentals. Or, maybe, the zoning ordinance will remain the same, it will be illegal to rent all or part of your home out on a site like airbnb.com and some property owners will do it anyhow. | |
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Owners, Operators of Short Term Residential Rentals in Rockingham County to Pay Transient Occupancy Tax |
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 If you are renting part or all of your Rockingham County home out on AirBNB you will need to start collecting and paying a transient occupancy tax of 5% of the gross rent starting January 1, 2019. Read on from yesterday's update from Rockingham County... ### NOTICE TO ALL OWNERS AND OPERATORS OF SHORT TERM RESIDENTIAL RENTALS LOCATED IN ROCKINGHAM COUNTY Beginning January 1, 2019, all owners of residential properties located in Rockingham County, Virginia, who rent all or any portion of a residential property for not more than 30 consecutive days must collect from the tenant the transient occupancy tax of 5% of the gross rent and remit the tax collected to the Commissioner of the Revenue for Rockingham County. The tax must be collected at the time of rental, and the remittance is made quarterly with the filing of a return. Owners and operators of short term rental properties should contact the Office of the Commissioner of the Revenue of Rockingham County for more details and information. 540-564- 3073. ### A short term rental is defined here as being a rental period of less than 30 days. | |
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How To Appeal The Assessed Value of Your Home in Rockingham County |
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 Do you live in Rockingham County, and is your home's assessed value too high -- causing you to pay more real estate taxes than you think you should be paying? If so, now is the time to appeal that assessment. The Board of Equalization of Real Estate Assessments is meeting over the next month and you can make your case for having the assessed value of your home adjusted. Here are the dates of the hearings, each being from 9AM - 12PM:
Call 540-564-5079 to schedule a time and date for a hearing with the Board of Equalization. Of note -- in my experience, most assessed values in Rockingham County are not higher than market value. | |
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Harrisonburg City Council Considering Regulating Short Term Rentals |
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 Do you have an opinion on whether short term rentals (such as via AirBNB) should be permitted and/or regulated in the City of Harrisonburg? If so, you should show up on Tuesday, September 11th for the public hearing on the topic. More from today's Daily News Record article...
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How Are Your City of Harrisonburg Tax Dollars Spent? |
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 I found the infographic above to be helpful. The largest portions of our local tax dollars are being spent on Education, Public Safety and Public Works! If you found the above interesting, you'll likely enjoy reading the entire (8 page) "Budget in Brief" developed by the City of Harrisonburg this year, with a high level analysis of the Fiscal Year 2018-19 budget for the City of Harrisonburg. Click below to download the report.  | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
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