CLAYTON — Stan Kroenke paid less in taxes last year on his 6,500-square-foot high-rise condominium in downtown Clayton.
The county assessor says the value of the billionaire NFL owner’s home fell by about $200,000, to $3.8 million. His tax bill dropped by about $5,300, to just under $47,400.
In neighboring Ladue, the same thing happened to Anheuser-Busch heir Steven Busch. His 8,100-square-foot home, with three fireplaces, five bedrooms and seven bathrooms, dipped in value by almost $400,000 to $1.9 million. His taxes tumbled by $7,300 to $24,250.
And the 4,400-square-foot Clayton home of ºüÀêÊÓƵ Blues goalie Jordan Binnington fell in value, too, by $100,000 to $1.9 million; his taxes sank by $3,300 to $24,600.
Home values have skyrocketed across ºüÀêÊÓƵ County, generally resulting in some of the largest increases in tax bills in years. But the trend, which has hit the county’s small homes and lower-income neighborhoods the hardest, hasn’t been the same for the region’s wealthy. Instead, a dip in the luxury real estate market has stagnated some property values, causing owners of the region’s more expensive homes to collectively see the smallest increases in appraisals, compared to two years ago, according to a Post-Dispatch analysis of county assessment data.
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“I have seen a slowdown in luxury properties, and I’ve also seen the price of luxury properties drop,†said Christy Kramlich, a Maplewood-based real estate agent. “I can think of one in Wildwood that probably would have gotten $1.2 million, and they probably will only get a million, and it will take longer to sell.â€
While most homes in the county increased in value, high-end homes lagged. A sliver, just 3% across the county, actually lost value, and those homes on average were larger and more expensive.
There are many potential reasons. Interest rates jumped. The wealthy are more likely to challenge county property appraisals. And it’s also just a small market in ºüÀêÊÓƵ.
“There really isn’t much of a market at the very, very high end,†said ºüÀêÊÓƵ County Assessor Jake Zimmerman. “There are very few sales, and when people are buying those really ritzy properties, a lot of times they’re paying less.â€
‘Not enough fancy-pants people’
At the same time, appraisals and tax bills soared last year for smaller homes in lower-income neighborhoods in North County and parts of South County.
The average appraised value in Wellston, which saw the biggest increases among municipalities in the region, doubled to $67,000 this year from about $33,000 in 2021, according to the Post-Dispatch analysis, and taxes jumped by $400 on average or about 60%.
Values in Oakville township in South County rose to $299,000 from $254,000, and the average tax bill leaped by $680 or about 23%, the biggest increases in the county, driven in part by school district increases to property tax rates. The nearby townships of Tesson Ferry and Lemay saw similar surges.
The next biggest tax bumps among townships, 18%-19%, were in Norwood and Ferguson, which include Kinloch, Ferguson, parts of Berkeley, Jennings, Dellwood and others. Values in Norwood rose to $79,000 from $57,000.
Skyrocketing demand for single-family starter homes has driven the imbalance, said experts and county officials. Some of that happened during the pandemic, when fewer homeowners put their houses on the market, driving up prices. And some came from a surge in investment firms buying up homes, especially starter homes.
Sales data from past years also shows the boom.
Between 2020 and 2022, ZIP codes in North County saw the biggest percentage increase in sales volume: The area that includes Wellston and Pagedale saw a nearly 29% increase; the Jennings and Ferguson ZIP code went up by 22%; and the Normandy and Bel-Ridge area saw a 21% jump, according to sales data provided by Mark Gellman, CEO of real estate firm The Gellman Team.
The ZIP codes with the highest median home sale prices saw sales volume decline overall. Sales numbers in Ladue, for instance, decreased by 20%; Town and Country, Des Peres and Frontenac saw a 24% drop.
It’s not exactly clear why the luxury market slowed down. But experts can guess.
High interest rates may have affected sales of higher-end properties more than the lower-end, said realtor Dan Lawless of Wood Brothers Realty.
“Payments could be thousands more per month,†he said.
The assessor says there’s not a lot of vacant land for new homes in ºüÀêÊÓƵ County. That drives the demand up for existing modest, single-family homes while the demand for high-end homes slowed in comparison.
And Zimmerman suspects there aren’t enough wealthy people who want to buy in ºüÀêÊÓƵ County.
“If the ritzy, fancy-pants places aren’t going up in value, it suggests there are not enough fancy-pants people creating jobs and keeping them in ºüÀêÊÓƵ,†Zimmerman said.
Kroenke’s Clayton condo
Wealthy homeowners are also the most likely to appeal their property values. They have the money to hire lawyers, more ability to free up time for the work, and the knowledge that appealing can reduce the appraised value of their homes — and save them money on their tax bills.
Only 6% of ºüÀêÊÓƵ County owners appealed their values this year.
The municipalities with the smallest appraised value increases — such as affluent Frontenac, Huntleigh and Country Life Acres — saw the highest percentages of appeals, between 17% and 27%.
The municipalities with the highest increases in appraised value — including Wellston, Hillsdale and Pine Lawn in North County — were among the lowest percentages of appeals, between 2% and 4%.
Still, wealthy residents are on the hook for an outsized portion of the county’s tax burden.
The owners of homes worth at least $1 million paid about 10% of all the taxes collected from single-family homeowners, even though those 7,500 luxury homes made up just 2% of the 347,000 single-family homes in the county.
Homeowners whose luxury homes dropped in value did not comment for this story: Busch, the Anheuser-Busch heir, declined to comment on the drop in taxes on his Ladue home. A spokesman for the Blues said Binnington declined to comment. And a lawyer for Kroenke did not return calls.
The homeowners in the luxury condo in downtown Clayton owned by Kroenke’s company didn’t have much of a reason to appeal this year. They were among the fraction of single-family homes countywide that saw their appraised values drop or stay the same this year compared to two years ago.
Values went down for 80% of the roughly 80 units there.
Darryl Ross, 79, was one of the few condo owners in the building who saw his appraised value increase — to $1.9 million this year from $1.8 million two years ago.
“There’s no reason for why it should have gone up. Maybe if we added a new room or something,†Ross said. “But we’ve done nothing.â€
So he appealed the appraisal.
And the county’s Board of Equalization agreed with his attorney’s argument: Similar condos in the building were selling for less.
That dropped the condo’s appraised value back down to the 2021 level and cut Ross’ projected tax bill by $1,600.
It would have been $25,000. Ross paid $23,400 instead.