Today’s headline in the Pasadena Star News proclaims that property values are on the rise.

My question is “Would that lead you to believe that home values have suddenly reversed their downward trend and the Pasadena real estate market has abruptly picked up steam”? If you read the newspaper by scanning the headlines then you may have a misunderstanding about what is actually happening in the City of Pasadena. The article goes on to say that Pasadena and San Gabriel saw increases of 10.2% in their property values. The article further quotes Rick Auerbach, LA County Tax Assessor as saying “We saw some decreases in value in single-family homes and condo’s. But we saw a lot of increase in multi-family buildings and commercial buildings, and that more than offset any decrease.”

We can unequivocally say that the increase in tax values can be reduced down to two words……..increased density.

Pasadena’s Real Estate – Value

In a city where the median home price has now shown 6 straight months of decline, I can assure you that values are not on the rise. But what you also have to understand is the manner in which the story is reported. The aggregate of Pasadena values are on the rise, and you don’t have to search very far to understand why. If you look at the new construction of Pasadena Condo’s and Townhomes a building boom certainly is in order. Apparently all of these new construction projects are now beginning to hit the tax rolls, resulting in a bigger tax base. The cities reporting tax increases are the cities that are experiencing increased building.

Many of these projects were green lighted before we heard the terms sub-prime mortgage crisis. However, it’s one thing to build them, it’s another thing to sell them. The developers of these projects are resorting to price concessions and some units are for lease, as the empirical data seems to suggest these developments are falling short of their sales goals.

Pasadena’s South Lake Shopping District

With all of the new housing units being built, a consolidation seems to be taking place in the retail area. Have you noticed all of the vacancies on South Lake? Once considered a premier shopping location the area is undergoing a transformation. Closed or soon to close are Wild Oats, Good Guys, Tower Records, Barry & Co. Jewelers, Lee-Mac Camera, Feast For The Home, Talbot Kids, Essence of Living, and Leather Factory. Quite a list. Are we destined to become a city of coffee shops and fast food?

Depending on your outlook, our city leader’s adoption of the current general plan will catapult Pasadena to the top of the list of desirable cities in which to live or create traffic tie ups that will only get worse once we have exited the freeway. My old boss used to say. “If you’re not growing, you’re dying”.

Let’s hope our short term desire remains in our long term best interest.

Tags: Pasadena's property values, Pasadena's tax base, Pasadena's tax revenue, Property value in Pasadena