RMV vs Sales Price

One of our readers sent in this guest post, thanks JS!

My wife and I bought a bungalow in NE Portland back in January 2001 and sold a year or so ago at a hefty profit. The "bubble fever" started out slowly but by 2004 it had started to infect several of my neighbors and by 2005 it had us all in its grip. If someone sold two streets over for well over their asking price we'd all know about it in about ten minutes. On the surface we passed such gossip over the back fence as business-like as possible so as not to appear greedy or otherwise unseemly. But as we related the news to each other our silly grins betrayed our true feelings: we're sitting on gold mines and getting rich by the minute! Many of us grew cautious and told ourselves not to get carried away by the wealth effect. Others tapped into their home equity for the most trivial of reasons.

During those seven years my wife and I had the Oregonian delivered daily to our home. My guilty pleasure during the bubble years was to read the weekly Bought + Sold column in the Thursday InPortland section. The column organizes home sales by zip code and shows both the sales price and the real market value (RMV) of the home. A firm called First American Real Estate Solutions provides the data to the Oregonian. Week after week the sales price would greatly exceed the RMV of homes throughout the metro area. What is the RMV? That's the estimate of the home's market value that Multnomah County's Assessment and Taxation Division calculates. They use it to help determine property taxes. If you have the street address of any property in the metro area you can find out its RMV by going to PortlandMaps and looking for its property value in the Summary section. Realtors will tell you that the figure is practically worthless and is far too low. And they have a point. The only way to know the true market value of a house is to put it up for sale and see what a buyer will pay for it. And yet, the estimate will put you in the ballpark at least.

So as I said, for all the years that I read the Bought + Sold column it always showed sales prices exceeding RMV estimates. And as I already mentioned, we sold our bungalow at the height of the bubble market. For a year now we've been renting, watching, and waiting. And it's a strange feeling. Now I'm on the buying side again and so I look at the Bought + Sold column from the perspective of a buyer. I want to see the trends. I need to know how much certain houses in certain zip codes sold for and whether they are over or under the RMV.

But I can no longer do that. Several weeks ago, without editorial comment, the Bought + Sold column dropped the RMV figure. Now they list only the sales price. Did the Oregonian's editors make this decision? Or do they farm it out to First American and they were the ones who made the decision? There is someone who does know and that's Michelle Brence, the InPortland Editor. I've e-mailed her twice to inquire about the change. But I've never received a reply. (If you're interested in giving it a try she can be reached at 503-412-7059 or by e-mail at michellebrence@news.oregonian.com.) It's a real hassle that the RMV is no longer printed. I've taken several street addresses from the column over the past few weeks and plugged them into portlandmaps.com to find the RMV. A surprising number of them are higher than the sales price. That means that a lot of sellers are willing to accept offers below the county's estimate, an estimate that realtors have said is too low to represent the real market value. But the average reader wouldn't know that because that information is no longer available. And that's a shame.

- JS