Acosta v. Multnomah County Assessor

CourtOregon Tax Court
DecidedOctober 26, 2021
DocketTC-MD 200140R
StatusUnpublished

This text of Acosta v. Multnomah County Assessor (Acosta v. Multnomah County Assessor) is published on Counsel Stack Legal Research, covering Oregon Tax Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Acosta v. Multnomah County Assessor, (Or. Super. Ct. 2021).

Opinion

IN THE OREGON TAX COURT MAGISTRATE DIVISION Property Tax

JOSHUA E. ACOSTA, ) ) Plaintiff, ) TC-MD 200140R ) v. ) ) MULTNOMAH COUNTY ASSESSOR, ) ) Defendant. ) DECISION

Plaintiff appeals the real property order of the Multnomah County Board of Property Tax

Appeals mailed March 11, 2020, for the 2019-20 tax year. A trial was held by video conference

on February 18, 2021. Plaintiff appeared and testified on his own behalf. Barry Dayton and

Elliot Scott appeared on behalf of Defendant. Appraisers Greta Klugness (Klugness) and Jan

Leendertse (Leendertse) testified as witnesses on behalf of Defendant. Plaintiff’s Exhibits 1

through 4, 7, 11, and 12 were received without objection. Plaintiff’s Exhibits 5, 6, 8 and 9, were

received into evidence over Defendant’s hearsay objection. Plaintiff’s Exhibit 10 was excluded.

Defendant’s Exhibits A through F were admitted into evidence without objection. Plaintiff’s

objection to Exhibit G was sustained.

I. STATEMENT OF FACTS

The subject property is a single family detached home, built in 1964 and remodeled in

2008, with approximately 3,172 square feet of gross living space, three bedrooms, two and a half

baths, and a two-car garage. (Ex 1; Ex 9.) It is located on a view lot in the hills above

downtown Portland on a steep slope without a useable yard. (Ex A at 6.) During testimony,

both parties described the property as having minimal street parking near the home.

1 DECISION TC-MD 200140R In June 2016, the subject property was purchased by Behgooy for $830,000. 1 (Ex A at

23.) On July 28, 2017, Behgooy signed a warranty deed to Brookfield Relocation Inc. for

$1,225,000. (Ex A at 25.) That deed was not recorded with the county until February 15, 2019.

Id. The relocation company listed the property for sale on the multiple listing service (MLS) for

$1,225,000 beginning early September 2017. (Ex 2 at 2; Ex A at 8.) The property was listed for

584 cumulative days. (Ex 2.) During that time, one accepted offer for $938,000, pending on

May 11, 2018, fell through due to a sewer easement issue where the real estate agent claimed the

sellers did not cooperate with the prospective buyers who needed a home immediately and could

not delay. (Ex A at 8.) Overall, the list price was changed eleven times, with a final listing price

of $845,000 starting in September of 2018. (Ex. 2.) Plaintiff first noticed the property in 2018

but did not attempt to purchase the property because it was above his price range. (Ex 9 at 1.)

In late 2018, the relocation company scheduled an auction for the property due to a lack

of offers. The auction was advertised in the local newspaper and online, with open houses held

in November and December 2018, and an online auction held December 3 through 5, 2018. (Exs

3-4.) The advertisements included a pre-auction opportunity where potential buyers could

submit their best offer to pull the property off the market before the auction occurred. (Ex 3.)

The nominal opening bid was $350,000. (Ex E.) Plaintiff participated in the auction but was not

the highest bidder; even so, he contacted the sellers and requested to be kept in mind if a deal

was not reached with the winning bidder. (Ex 9 at 1.) The relocation company was unable to

finalize the sale with the winning bidder and contacted Plaintiff to negotiate a sales price through

email. (Ex 6.) Plaintiff utilized the services of an unrelated real estate agent, Benjamin Acosta,

1 It is unusual for the court to review such an extended sales history of a subject property. However, in this case the prior sales history, the subsequent marketing of the property, and Plaintiff’s purchase of the property must be considered to determine whether Plaintiff’s purchase represented an arm’s-length transaction.

2 DECISION TC-MD 200140R to negotiate the deal. After many back-and-forth discussions, the parties agreed on a sales price

of $675,000 plus a buyer’s premium of $33,750. (Ex 6 at 2.) The property was sold “as-is,

where-is” without contingencies for repairs or inspections. (Ex 4 at 2; Ex 7 at 1.) The executed

contract was dated January 18, 2019. (Ex 7 at 2.)

For the 2019-20 property tax year, Defendant assessed the real market value of the

subject property at $814,880. (Compl at 2.) Plaintiff filed an appeal with the Board of Property

Tax Appeals (BOPTA), which ordered the value be sustained. (Id. at 2.) Plaintiff now appeals

the BOPTA order and asks this court to find the real market value of the property to be $675,00,

exactly equal to the sales price of the subject property, or “a reduction to a more reasonable

value.” (Ptf’s Compl at 1.) Defendant asks this court to sustain its determined value of

$814,880. (Def’s Ans at 1.)

During trial, Plaintiff testified that his purchase of the subject property represented an

arm’s-length transaction because it was heavily negotiated between two informed, sophisticated

parties and thus best represented the real market value as of the assessment date January 1, 2019.

Plaintiff noted that the subject property was in poor condition, requiring multiple repairs, which

justified the lower purchase price.

Plaintiff presented an appraisal prepared in connection with his bank loan, which

concluded the market value of the subject property was $723,000 as of February 6, 2019. (Ex 8

at 2.) That appraisal identified three main comparable properties, with a fourth as inferior, and a

fifth as an active listing. (Ex 8.) Comparable 1 was a four-bedroom, three-bath residence

consisting of 2,153 square feet that sold for $820,300 in September 2018. (Id. at 2.) The price

was adjusted downward by $61,800 for the 618 additional square feet on the main level, and

upwards by $17,010 for the 243 fewer square feet for rooms below grade, resulting in an

3 DECISION TC-MD 200140R adjusted sales price of $775,510. (Id. at 2.) Comparable 2 was a three-bedroom, three-bath

residence that sold for $635,000 in October 2018. (Id. at 2.) That price was increased by

$12,200 for the 125 additional square feet on the main level and $22,050 for the additional 415

square feet on the rooms below grade, making the adjusted sales price $669,250. (Id. at 2.)

Comparable 3 was a three-bedroom, three and a half-bath residence which sold for $780,000 in

October 2018. (Id. at 2.) That sale was decreased by $64,900 for square footage above-grade

and increased by $10,080 for square footage below-grade, making the adjusted sales price

$737,180. (Id. at 2.) Comparable 4 was a three-bedroom, two and a half-bath residence that sold

for $715,000 in October 2018. (Id. at 7.) That price was increased by $20,000 for lack of view,

decreased by $53,100 for above-grade living area, and increased by $10,000 for lack of air

conditioning, making the adjusted sales price $691,900. (Id. at 7.) Comparable 5 was a listing

on the MLS offered by the appraiser as support only. (Id. at 2.) The appraiser weighted

Comparables 1 through 3 at 30 percent each and Comparable 4 at 10 percent, concluding that the

market value for the subject property as of February 6, 2019 was $723,000. (Id. at 2.) The

appraiser considered the cost approach and found a value of $727,646. (Id. at 2.) Plaintiff also

submitted a comparative market analysis prepared by Benjamin Acosta, which used three of the

same properties in the bank’s appraisal and concluded the subject property was worth $706,295

as of the assessment date. (Ex 9 at 2.)

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Acosta v. Multnomah County Assessor, Counsel Stack Legal Research, https://law.counselstack.com/opinion/acosta-v-multnomah-county-assessor-ortc-2021.