Charlottesville & Albemarle Real Estate Assessments – 2017

  • Charlottesville & Albemarle Property taxes up. 
  • Rural conspiracy?
  • What do real assessments mean?

The following message came to me the other day

Mr. Duncan: have you heard any thoughts on the recent county rural tax assessments. my land value dropped roughly 25% this year. I am located 2 miles from the heart of Crozet, closer than some houses in Old Trail. Do Assessors have any legal limit on how much they can devalue land in a year? 25% seems almost criminal. It was $84,700 the past two years and then $63,100 this year. Do you feel this might be intentional to deter rural sales and drive the open market into ‘growth areas’. Do you know whether Old Trail went up or down and by how much? curious minds would like to know. thanks for your time and reporting on the Greater Crozet area.

Is Albemarle County conspiring to lower rural property values?

Interestingly, I’ve gotten a couple questions about this from residents in Western Albemarle. Are they conspiring? Doubtful. Are the county real estate assessments accurate? Maybe. It depends. I don’t see a property’s assessed value as it’s market value. (skip to the end to read that rationalization)

While Albemarle County ostensibly does want to drive growth into growth/development areas, I can’t see them conspiring to intentionally devalue land. If anything, they would conspire to inflate property values, as that is one of the primary sources of the County’s revenue.

If you have a question about your assessed value, or are thinking about challenging the value, ask me.

 


5 Reasons why real estate assessments matter

1) The County bases their budget on property tax revenue.
2) The assessed value is the value upon which property owners pay taxes.
3) Buyers look at assessed values as a measure of market value – but really, it’s a point in the equation, but are neither a definitive point nor a necessarily accurate one.
4) Also – Virginia, unlike some other states, by Statute requires localities to assess property at 100% of fair market value, based on an objective analysis of the property’s fair market value.
5) Sellers look at assessed values and wonder if buyers will think that the assessment means their home is worth X (it doesn’t).

6) Buyers and Sellers also look at zestimates … which are sometimes right, sometimes not.

From the Albemarle County Press Release

The change in the County’s total “Fair Market Value” base has increased by 2.9% over the 2016 base. Overall reassessment changes by property type are:

  • Urban Residential (County Water & Sewer):  4.20%
  • Residential up to 20 acres:  1.18%
  • Rural (20 to 99.99 acres):  2.19%
  • Rural (100 acres and over):  4.31%
  • Commercial Properties:  2.32%
  • Multi- Family:  4.78%

The above results by property class are still overall increases and individual properties within each class may vary significantly in either direction from those amounts. The reassessment figure reflects the values of existing properties and does not include the value of new construction. New construction is estimated to be valued at $200,000,000 for the assessment period and includes new parcels created through subdivision.

Virginia by Statute requires localities to assess property at 100% of fair market value, based on an objective analysis of the property’s fair market value, independent of any influence on the part of the County or the County Board of Supervisors.

The average annual reassessment changes for the magisterial districts are as follows:

  • Rio:  2.96%
  • Jack Jouett:  2.93%
  • Rivanna:  1.86%
  • Samuel Miller:  3.20%
  • Scottsville:  3.65%
  • White Hall:  2.88%

 

City of Charlottesville Assessments Up, Too

 

In Charlottesville, the value of residential parcels throughout the city has increased by an average of 4.2 percent, according to city officials.

While the owners of four-fifths of the city’s residential properties can expect an increase in their real estate tax bill, less than 4 percent of those properties have decreased in value. Sixteen percent of city homeowners will not see a change in the value of their property.

If the city’s real estate tax rate remains at 95 cents per $100 of assessed value throughout the rest of calendar year 2017, residents who own a home valued at $300,000 and had it increase by 4.2 percent can expect their annual real estate tax bill to go from $2,850 to about $2,970.

Commercial properties, which include apartment complexes and retail, office and industrial spaces, as well as vacant land, have increased by an average of nearly 30 percent.

Similarly to residential properties, more than 80 percent of commercial lots have increased in value. Ten percent of those properties will see no change in value, while 7 percent decreased.

Combined, existing residential and commercial property increased in value by almost 15 percent.


My answer to a client (in 2011) asking about the assessments’ relation to market value and pricing their home to sell

Assessments are not a reflection of market value. They are a backward-looking assessment of what the market value may have been at the time the assessor looked at the house (most likely online, and not in person). The assessor may or may not know the condition of the property, the condition of the property’s neighbors, may not consider the traffic noise, crime stats, proximity of sexual offenders, level of inventory, smell of the neighborhood, etc. etc. etc. Assessments are why you pay taxes on.

And from the Bubble Bloggers’ post (in 2011):

c-ville: What do the assessments mean in relation to the CAAR report, and CAAR-provided stats like the # of days on market, etc?

Almost nothing.  Any reputable Realtor will tell you this.

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5 Comments

  1. Peter Lynch February 10, 2017 at 17:16

    Jim,

    I have been hearing theories about why the rural area land values decreased and improvement vales increased for the recent 2017 reassessment.

    I can give you the definitive answer: we did studies with the International Association of Assessing Officers and internally in our office that determined, based on land sales, that we generally needed to reduce the rural area land values.

    Studies of improved sales throughout the county indicated that we needed to increase the rates used in the model used to value improvements. This mainly affected the rural areas, since in the past my appraisers had other ways to adjust urban area properties. These changes are supported by over 200 improved sales in the rural areas.

    Anyone with a concern over their property value should contact my office at 434-296-5856 where they can get an explanation of the process and request a review is desired. I commend you for your 5 Reasons in this blog since it is right on.

    Agents do their own analysis to determine what a property would sell for so they can appropriately advise their clients.

    I would add that my office is separate from the budgeting process. There is no influence on us from anywhere in the county government to come out with a predetermined amount just to raise revenue.

    Sincerely,

    Peter Lynch – Albemarle County Assessor

    (Jim’s note: edited to add line breaks)

    Reply
  2. Jim Duncan February 15, 2017 at 13:35

    Peter –

    Thank you so much for taking the time to comment. This is extremely helpful.

    — Jim

    Reply
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