In recent posts, I seem to have come down hard on Rowlett's "officialdom." Much of it is because of frustration.
I have personally met and visited with all of the council members, the city manager, many of the department heads, and a whole bunch of people that make the whole thing work. I am not against them. For the most part, I think they do a good job of keeping Rowlett running well. Be assured, I have seen a whole lot worse.
My frustration comes from people that think they know what they're doing when they may not. However, their decisions represent 58,000 people. That fact alone calls for conscientious research on decisions being made in which they have limited knowledge. In my opinion, they often fail in the area that I am uniquely qualified to comment on. That does not make "officialdom" stupid or uncaring. Nor does that make me brilliant. However, I have spent the better part of 50 years analyzing real estate development projects and markets. I think I know a little bit more about real estate development than the average poorly paid elected official. I did it for a living.
At various times in my life, I have been paid a salary for 1. real estate appraisal, 2. construction material sales, 3. building houses, 4. para legal services for a major USA wide developer (Trammell Crow), 5. construction inspection, 6. "work out" specialist for a major lending institution, 7. real estate development loan officer for three major lending institutions (Lomas & Nettleton, Commonwealth Financial, and GE Capital), 8. commercial general contractor and cost analysis, 9. real estate agent, and 10. currently either in my own company's name, or as a consultant to major lenders, .....still......all the above. In the military, I would be stamped "literate" about real estate development matters.
My frustration comes from analyzing Rowlett's market and then watching "officialdom" throwing darts to make a decision. In my opinion, too little research is done when deciding the course of future development.
Why the importance of real estate development? In the previous post, it was written that a $250K house is earning the owner $25K per year. It could be better. Furthermore, if the tax base is improving in average value per resident, the tax rate actually goes down provided the cash needs of the city remains the same. This makes the nurturing of the tax base one of the most important things any "officialdom" can do. It has significant effects on each taxpayers money matters. It is absolutely important, measured in real time cash, that you know what you're doing when tampering with the tax base. A major screw up, and taxpayers pay for it immediately by watching their escrow payments go up, or writing a check.
There is a common misconception. You have often heard it said that, "if my real estate values go up, my taxes go up." That is usually not true, unless you have been undertaxed. If real estate values are increasing by 10% this year, and everyone's values are increased by 10%, and City Hall is spending the same, your taxes shouldn't change. The tax rate should decrease by 10%. If it doesn't, someone is getting flim flammed. If in a isolated incident, someone's value goes up, and none of the neighbor's properties go up, there is a good chance your taxes will go up. There are two reasons for this. 1) Either the appraiser made a mistake, or 2) your house was undervalued in comparison to other properties in the neighborhood. Of course, all of this is subject to the city spending the same amount of money each year. Sometimes they spend more, huh?
I am attempting to explain why the tax base is so important. It requires a little more sophisticated thinking than deciding when or how to buy a fire truck.
In this regard, I think elected officials need some help when deciding real estate matters. I thought we were getting that type of help when the consulting firm came to Rowlett and subsequently give birth to Rowlett 2020. I was wrong. We didn't get what I thought we would. We got very little factual information and a whole bunch of opinion. You must remember, I am an ex-loan officer. I don't deal in opinion. Some elected officials proclaim they deal only in facts, when they wouldn't know a real estate fact if it hit them in the eyes. Does that mean they're stupid? Of course not. It means they lack knowledge of the application of real estate data. I don't think any of them know what an absorption rate study is.
I have written that doctors are smart, but they can't fly a Boeing 747. A Boeing 747 pilot can not remove your appendix, either. It's a matter of getting the square pegs in the square holes.......or if there is no fit, know where to get the information. It is a major misdeed to pretend you know something and don't, or refuse to seek out the information when you need it. When it is not done, that's what frustrates me. When not properly researched, a real estate development can become a huge white elephant. So far, we have avoided the big ones. Some smaller ones didn't do so well. The land give away for the ill conceived restaurant deal downtown comes to mind.
I think most of "officialdom" are good people. They are pretty smart, well intentioned, and generally have Rowlett's good future in mind. I just wish they wouldn't try to fly Boeing 747s.
I have personally met and visited with all of the council members, the city manager, many of the department heads, and a whole bunch of people that make the whole thing work. I am not against them. For the most part, I think they do a good job of keeping Rowlett running well. Be assured, I have seen a whole lot worse.
My frustration comes from people that think they know what they're doing when they may not. However, their decisions represent 58,000 people. That fact alone calls for conscientious research on decisions being made in which they have limited knowledge. In my opinion, they often fail in the area that I am uniquely qualified to comment on. That does not make "officialdom" stupid or uncaring. Nor does that make me brilliant. However, I have spent the better part of 50 years analyzing real estate development projects and markets. I think I know a little bit more about real estate development than the average poorly paid elected official. I did it for a living.
At various times in my life, I have been paid a salary for 1. real estate appraisal, 2. construction material sales, 3. building houses, 4. para legal services for a major USA wide developer (Trammell Crow), 5. construction inspection, 6. "work out" specialist for a major lending institution, 7. real estate development loan officer for three major lending institutions (Lomas & Nettleton, Commonwealth Financial, and GE Capital), 8. commercial general contractor and cost analysis, 9. real estate agent, and 10. currently either in my own company's name, or as a consultant to major lenders, .....still......all the above. In the military, I would be stamped "literate" about real estate development matters.
My frustration comes from analyzing Rowlett's market and then watching "officialdom" throwing darts to make a decision. In my opinion, too little research is done when deciding the course of future development.
Why the importance of real estate development? In the previous post, it was written that a $250K house is earning the owner $25K per year. It could be better. Furthermore, if the tax base is improving in average value per resident, the tax rate actually goes down provided the cash needs of the city remains the same. This makes the nurturing of the tax base one of the most important things any "officialdom" can do. It has significant effects on each taxpayers money matters. It is absolutely important, measured in real time cash, that you know what you're doing when tampering with the tax base. A major screw up, and taxpayers pay for it immediately by watching their escrow payments go up, or writing a check.
There is a common misconception. You have often heard it said that, "if my real estate values go up, my taxes go up." That is usually not true, unless you have been undertaxed. If real estate values are increasing by 10% this year, and everyone's values are increased by 10%, and City Hall is spending the same, your taxes shouldn't change. The tax rate should decrease by 10%. If it doesn't, someone is getting flim flammed. If in a isolated incident, someone's value goes up, and none of the neighbor's properties go up, there is a good chance your taxes will go up. There are two reasons for this. 1) Either the appraiser made a mistake, or 2) your house was undervalued in comparison to other properties in the neighborhood. Of course, all of this is subject to the city spending the same amount of money each year. Sometimes they spend more, huh?
I am attempting to explain why the tax base is so important. It requires a little more sophisticated thinking than deciding when or how to buy a fire truck.
In this regard, I think elected officials need some help when deciding real estate matters. I thought we were getting that type of help when the consulting firm came to Rowlett and subsequently give birth to Rowlett 2020. I was wrong. We didn't get what I thought we would. We got very little factual information and a whole bunch of opinion. You must remember, I am an ex-loan officer. I don't deal in opinion. Some elected officials proclaim they deal only in facts, when they wouldn't know a real estate fact if it hit them in the eyes. Does that mean they're stupid? Of course not. It means they lack knowledge of the application of real estate data. I don't think any of them know what an absorption rate study is.
I have written that doctors are smart, but they can't fly a Boeing 747. A Boeing 747 pilot can not remove your appendix, either. It's a matter of getting the square pegs in the square holes.......or if there is no fit, know where to get the information. It is a major misdeed to pretend you know something and don't, or refuse to seek out the information when you need it. When it is not done, that's what frustrates me. When not properly researched, a real estate development can become a huge white elephant. So far, we have avoided the big ones. Some smaller ones didn't do so well. The land give away for the ill conceived restaurant deal downtown comes to mind.
I think most of "officialdom" are good people. They are pretty smart, well intentioned, and generally have Rowlett's good future in mind. I just wish they wouldn't try to fly Boeing 747s.
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