Sale prices of new homes in Douglas County jumped 22 percent last year, feeding an above-average rise in residential property values in aging areas of Lawrence and other area towns.

That’s the word from Douglas County Appraiser Marion Johnson, whose office will mail 37,550 change-of-value notices Monday to county property owners. The notices show property values as of Jan. 1, numbers to be used for computing tax bills set to arrive in November.

The average cost for a new home last year hit $233,200, up from $190,800 a year earlier, Johnson said.

The rising prices combined with a dwindling supply of new homes — the county recorded 350 sales, down from 394 in 2003 — puts pressure on values in aging areas of Lawrence, Johnson said. Neighborhoods east of Massachusetts Street and near the Kansas University campus will see above-average increases for this year.

“A lot of the newer neighborhoods are building a higher-priced home,” Johnson said. “If you look up there in those areas north and west of Free State (High School), those are homes that are way over the $200,000 price range.

“That eliminates a lot of the first-time homebuyers, or even a lot of people in the housing market. So if they can’t buy a new home, they have to look back into the older housing stock, and when you do that it creates more demand.”

With mortgage interest rates staying below 6 percent and the overall economy showing signs of a turnaround, buyers continue to seek moves out of rental housing. And that keeps residential values climbing.

“It’s just the law of supply and demand,” Johnson said. “If there’s more demand, and there’s no (new) supply, then the price goes up. And the values go up.”

Douglas County appraiser Marion Johnson's office will mail 37,550 change-of-value notices Monday to county property owners. He said homeowners in Lawrence's aging areas will see an above-average increase in valuations because of rising housing prices and a short supply of new homes. Property owners who want to contest their property values have until March 30 to request a hearing.

Countywide, owners of single-family homes, duplexes, triplexes and fourplexes can expect to see their property valuations rise 4 percent to 6 percent for this year — about the same as a year earlier, Johnson said.

But several areas can expect jumps of even more, Johnson said:

• East Lawrence, Brook Creek and other neighborhoods east of Massachusetts, from the Kansas River to 23rd Street, can expect above-average increases — greater than 7 percent.
• Owners of homes in the area near Hillcrest School should not be surprised by values that are 8 percent to 10 percent higher than 2003. The area’s smaller homes — 1,000-square-foot ranchers — saw particularly large increases.

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Some areas of Alvamar and other emerging areas likely will see average increases of 2 percent to 3 percent, he said.

“The $300,000 to $600,000 homes don’t increase in value all that much,” Johnson said.

Values for apartment complexes are up about 15 percent from a year earlier, said Sharon Dominik, appraisal manager. Several large sales — including more than $16 million each for Pinnacle Woods and Jefferson Commons — lifted the entire market.

The commercial market also remains healthy, at least in terms of property values, Dominik said. Many commercial properties will see increases ranging from 5 percent to 10 percent.

Downtown Lawrence — an area with spiking value increases in recent years — can expect moderating valuation rises this year, Dominik said. Most properties will see increases of 7 percent to 8 percent.

The property values are not final. Property owners may appeal their values by filling out the form on the back of the change-of-value notice, and returning it to the appraiser’s office.

Forms must be postmarked by March 30, or be dropped off at the appraiser’s office by 5 p.m. March 30.

Informal hearings begin March 14, and must be completed by May 15.