Amherst House Prices Shoot Up

by Nick Grabbe

A flurry of home-buyers caused sale prices to jump in Amherst this spring, with houses often selling for more than their asking prices.

“It was such an unusual time, and we were all walking around scratching our heads,” said Kathy Zeamer, a spokeswoman for Jones Realty. “Even realtors who have been in business for 40 years said they’d never seen anything like this.”

“Frenzy” isn’t too strong a word for the bidding wars that real estate agents saw over houses that were well-maintained and priced reasonably, she said. She offered some eye-popping examples:

  • A two-bedroom house on East Pleasant Street (shown at left) was listed for sale at $299,900. In three days, there were 50 showings and nine offers, and it sold for $345,000 to an out-of-town buyer.
  • A house on Middle Street was listed for $599,900, and someone bought it the first day it was on the market, for $612,500 – in cash.
  • A house on Amity Street was listed at $665,00 and sold for $708,800 in four days.

(For a list of recent sale prices of single-family houses in Amherst, click on “Recent House Sales” at left.)

If you already own your house, this white-hot market means it is now likely worth more than a year ago, and your net worth just went up a notch. My own Amherst house, which I bought for $66,000 in 1984, is now worth about six times as much. This hot market also works well for people who have just sold a brownstone in Brooklyn for $2 million and want to buy a house in Amherst and still have plenty of money left over.

But for middle-income people and first-time home-buyers, it’s been a frustrating time. And this price run-up has increased the already-wide wealth gap in Amherst between people who own homes and those who rent.

During the pandemic, many people living in urban areas and working from home figured they could do that just as easily in Amherst. Some were attracted to the cultural and outdoor activities in the area, and some had family members here, Zeamer said. Many sales this spring were to buyers from urban areas.

“They come with a lot of cash, and look at the prices of properties here, and it looks like quite a bargain,” she said.

It’s hard for a local buyer to compete, Zeamer said. Presented with a cash offer, many sellers don’t want to take the risk that a bidder won’t be able to get financing. It can take four to six weeks to get a mortgage commitment.

Some bidders have taken to writing letters to the sellers pleading their cases, or even agreeing to waive inspections or pay closing costs, she said. But many companies counsel against writing letters to sellers “due to the possibility (or even the perception) of favoritism that may be interpreted as discriminatory,” Zeamer said.

One buyer sold his house in California for $5 million and bought a house in Amherst for $1.4 million, said real estate agent Nancy Hamel. “A first-time buyer putting down 5 percent might as well not even make an offer,” she said. “FHA buyers don’t have a chance. How do you compete with that kind of money?”

Another reason for the frenzy is that there have been fewer houses for sale than usual. Normally, there are about 100 houses for sale in Amherst. By mid-June, there were around 10.

“Many homeowners did not want people coming through their homes during the pandemic,” Zeamer said. “Since vaccines have become available, people are more relaxed about opening their homes.”

Another attraction for buyers is that mortgage interest rates are very low now. Many people worry that inflation will cause them to go up next year, so they figure that now is a good time to buy.

Although your house is worth more now, you are paying taxes on only a portion of its value. But that will change.

Many houses have sold in the last few months for 30 percent more than their assessed value, which is Town Hall’s estimate of how much a house is worth. It is calculated to determine how to distribute the property tax burden, but it takes a while for assessed values to catch up with increasing sale prices .

For example, a house on Aubinwood Road, assessed at $338,900, recently sold for $485,000. A house on Baker Street, assessed for $290,300, sold for $450,000. A house on South East Street, assessed at $365,800, recently sold for $532,000.

Property taxes are due Aug. 2. Your annual property tax is calculated by dividing your assessed value by 1,000 and then multiplying by the tax rate, which was $21.82 in the fiscal year that just ended. The tax rate for the new fiscal year has not been set yet.

The median assessed value for a single-family house is $365,650, with an annual tax obligation of $7,978 in the fiscal year that just ended.

Assessed values will likely increase next year to reflect higher sale prices this year. That will probably cause the tax rate to go down. But tax bills always go up because the amount the town needs to raise in taxation always goes up by slightly more than the 2.5 percent limit set by state law. Changes in assessments don’t directly cause tax increases and happen every five years or whenever the average sale price is more than 10 percent above assessed values.

The frenzy of buyers is now past. “It’s calmed down a little bit, and in the summer things slow down,” said Zeamer.

But the price of a house in Amherst is likely to remain high.

A Crowded Future for Amherst Elementary Students

by Sarah Marshall

With distance learning disallowed for the 2021-2022 school year, all of Amherst’s primary and secondary school students will attend school in person.  However, students will find that all three elementary schools, which were reconfigured last summer to allow improvements to HVAC systems and at least six feet of distance between students and teachers, feel crowded.  How can this be, when enrollments are dropping?

At Wildwood and Fort River schools, the infamous quads, with their incomplete walls, poor ventilation, and spaces with no windows, were transformed into two classrooms each, with floor-to-ceiling walls, amped-up ventilation, windows, and desks widely separated.  This reconfiguration cut the number of classrooms in half. During the spring, some students attended class remotely, meaning that the schools hosted less than 100 percent of the student body. 

Next year, as 100 percent of students return, spaces such as cafeterias and specials rooms will be turned into classrooms, and many support services will operate out of the libraries.  There will be no dedicated art and music classrooms, and instructors will take their carts from room to room, with obvious limitations to their curricula.  Students will eat lunch in their classrooms.  At Fort River, the successful and growing bilingual  program, Caminantes, also affects space allocations, as each grade level offering Caminantes needs three classrooms, two for Caminantes and one for the standard program.  Crocker Farm was not built with quads, but space was also reallocated to improve ventilation and spacing within all teaching areas.  The unique space pressure at Crocker Farm comes from the growing preschool program, which enrolls all of the district’s special-needs 3-to-4-year-olds.

What can be done to get all elementary students back in true classrooms, restore the art and music rooms, and leave cafeterias for diners?  Some options have been mentioned at School Committee meetings and others can be imagined, but the feasibility, timeline, and cost of each option must be determined.  However, it is probably not possible to solve the problem for the 2021-2022 school year.

For the 2022-2023 school year, we can: (1) Do nothing, and live with the current space plans. (2) Buy or rent modular classrooms for some of the elementary schools. (3) Rip out all of the changes made to the buildings last summer and let the schools revert to their prior states.  The changes made to prepare for teaching during the pandemic did not cost Amherst taxpayers a dime, since federal and state relief funds paid for the construction. However, reversal of these changes would be paid for entirely by Amherst.  (4) Make the Middle School a 6-8-grade school, a common grade configuration in Massachusetts and throughout the U.S.  The Middle School currently hosts about 425 students, but as recently as 2000 hosted about 725 students.  The Middle School can easily absorb all of Amherst’s 6th-graders and ease space demands at all three elementary schools.

The possibility of reconfiguring our elementary and middle schools has been contemplated for years.  In 2018, Regional Schools contracted for a study exploring the feasibility and potential costs of creating a grades 6-8 Middle School and a grades 7-12 High School.  The second option was estimated to cost at least $40 million, whereas the cost of the first option was deemed to be essentially zero.  In 2019, and in light of the study, the Regional School District authorized formation of a Middle School Grade-Span Advisory Committee, tasked with exploring the factors, impacts, and potential pros and cons of moving 6th-graders to a Middle School; the committee was not tasked with developing a recommendation, which falls to the elementary school committees of our region (that is, Amherst, Pelham, Leverett, and Shutesbury).  The Advisory Committee was about to issue its report in the winter of 2020 when the pandemic struck, upending all plans.

With the pandemic receding, the Grade-Span report was released this past April, and the Regional School Committee began discussing the matter in May.  The only decision yet taken at the Regional level was to allow the elementary school districts to begin their own deliberations, if interested.  The Amherst School Committee has decided to study the pros and cons of moving our 6th-graders to the middle school, and in the fall will begin a community engagement process in which information, options, and feedback will be shared and gathered.  The goal is to arrive at a decision before the December holidays so that teachers and administrators can begin planning how to best design and accommodate the chosen programs beginning in the 2022-2023 school year. The crowding of the elementary schools described above (as well as the need to define the size and scope of the new elementary school building project) now gives urgency to the question but is not the original impetus for considering the move.

Some families are alarmed at the possibility that ARMS might become a 6-8-grade school.  I served on the Grade-Span Committee with outstanding, thoughtful elementary and middle-school teachers and administrators, as well as other parents.  I am confident that, should the 6th-graders move to ARMS, they will do so only after a well planned curriculum, environment, and support systems are developed that are appropriate for these young people’s educational and social/emotional needs.  I do not believe they will be tossed into the current 7-8 program and left to make their own way.  However, as our community begins the discussion about where to best locate 6th grade, it will be important to have an understanding of the alternative – what the elementary school environments will be like during the next several post-covid years.

Hello, Amherst!

The Amherst Current will focus on our town’s pressing issues: local elections, infrastructure projects, our changing demographics, new construction, taxes, and much more. We are working with contributors who have deep experience with Amherst issues, and we hope to post twice per week, generally alternating between “explainers” and opinion pieces.

With the decline of traditional media, many people are confused about the many complex challenges Amherst faces. We hope to increase understanding of these issues and provide perspective on them. And we feel that Amherst could benefit from another discussion forum.

Few people have the time to attend or watch the many meetings of Town Council and our boards and committees (thank you, dedicated volunteers, elected officials, and town staff!). So we will try to help you by focusing on what is most critical as you decide what petitions to sign or not sign and for whom to cast your votes.

We want to be clear: we favor building the four proposed capital projects (Jones Library expansion, Public Works headquarters, South Amherst fire station, and a new Wildwood/Fort River elementary school) in a fiscally prudent manner. We support increasing the density of downtown and village centers, as recommended by the master plan, and support business growth and a broadening of the tax base. We will favor candidates who support these goals.

We want to promote civic engagement, civility, and open discussion of the issues that Amherst confronts. We will encourage residents to vote in the November election.

Let us know what you think, and what you want to read about! Subscribe and be alerted to new posts. Email us at theamherstcurrent@gmail.com. And feel free to comment, as long as you can abide by our comment policy and will give your name and email address (we won’t ever display the latter). And, lastly, please forgive technical glitches as we learn how to do this!

— Sarah Marshall and Nick Grabbe