Special Bd. of Aldermen — 02/27/2017 Page 8
Alderman Jette
So using the income approach for commercial property is that different than what we’re doing now and what
we’ve done in the past?
Ken Rodgers
Yes | don’t think they’ve ever analyzed the income. Ina city as large as Nashua if a person is going to
purchase a property, they’re going to want to look at the income stream of that property and that’s really the
driving force of why they would consider it. Right now | think the only approach that they’re using is the cost
approach.
Alderman Jette
For sales, you say you use sales that will have occurred between April 1, 2017 and March 31, 2018. Why is it
limited to just one year? Why don’t you look at sales that occurred prior to that year?
Ken Rodgers
We can look at them. The Department of Revenue pretty much has the guidelines of what sales we need to
use. We will if we don’t have sales in certain classes. We'll go back a couple of years and maybe we have to
do a time adjustment on them to bring them up to current market. For the DRA’s analysis, that’s their period of
time.
Rob Tozier
Typically in a city you'll have far more sales to use. So one year would be sufficient to get enough data points
to create a valid model for valuation. You could have 1,000 sales to analyze which is a very large sample to
use in just one year.
Alderman Jette
So if | bought my house in 2000 for a certain price and | still own it and there hasn’t been a sale, how do you
value my house if it’s beyond that one year sales period.
Ken Rodgers
You're sales period is dictated in what the market is at this point in time. So we’re going to bring your property
up or down depending on the situation to market value as of April 1°". So the 2000 sale probably doesn’t mean
very much to us.
President McCarthy
It would seem to me that if you’re looking at sales of residential houses in an area like Nashua that has a huge
stock. A sale from last year of a house with similar square footage, the same number of bedrooms, same
utilities, similar neighborhood is more of an accurate predictor of market value in 2018 than a sale from 2000 of
that exact property.
Rob Tozier
Correct. Of course, yes.
