Mortgage Market Update - Property Assessments vs Market Values

Mortgage and Lending with Premier Capital Mortgage


This is a challenging year for the Tax assessors office as they are under incredible pressure by homeowners who look for assessed home values to follow market values.  In the past assessed valued have typically trailed market values by 10% or so.  Today we are seeing the opposite as market values are now below assessment values. 

As you may be working with home buyers identifying great opportunities one of the challenges is to properly quote payments and provide accurate expectations.  I have seen purchase contracts in the 70k - 80k range with property taxes in the $2,500 - $3,000 range.  Typically this home price range would have property taxes in the $900 - $1,200 range.  Obviously this is going to impact the payment for the home and going to affect pre approval price ranges.  One solution we are providing is to always quote accurate payments based on actual property taxes.  On the PCM website we have posted a link on the Home Loan Toolbox page for property taxes across the United States(scroll toward the bottom of the page).  

One statement that many buyers are told is that the property taxes should go down in the next year.  I understand that this might seem like a realistic expectation but there is no way to guarantee this to the buyer.  However recent legislation is empowering homeowners with more options than before.  Senate Bill 240 changes this -  assessments must now be fair or a property owner can take a professional appraisal straight to an arbitrator and receive a lower, true fair market valuation.  Some highlights to the legislation is the following

                    - The appeal must be filed within 45 days of the mailing
                    - Taxpayer will provide an appraisal dated with 30 days of appeal
                    - Board of Assessors has 30 days to review to accept - if not
                    - Information will go to clerk of superior court and arbitrator will be assigned in 15 days
                    - Arbitrator has 30 days to set appointment and 30 days to render decision
                    - **The Board of Assessors has the burden of proving value
                    - Whichever party loses they shall pay the cost of the arbitration

As you are working with clients this information should help to set the right expectation and provide the most up to information so they can make the proper decision. 

Sort of an interesting proposition above as if the county loses the arbitration we all still lose because our tax dollars continue to pay the bill.  Hopefully there will not be big issues as the Assessor office is able to deal with the appeals efficiently.  In March we sent out an appeal message for homeowners to take action early.   I sent in an appeal before the assessments came out and just received my new value.  Very pleased with the results and don't need to go further.  

There is now way to get out of paying - sure your value may be lowered but the next question is when will your millage rate may go up.  Time will tell. 

Property Tax Links

Tax Assessors Office - Henry County GA

Property Tax Callendar - Henry County  GA 

Tax Commissioner Best site to find property taxes - Henry County GA


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Joe Farro
Premier Capital Mortgage




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Retired Notworking
Tallahassee, FL

It's good that homeowners won't have to pay taxes on property that is assessed too high, but as you mention, not so good that there will be fewer tax dollars for county budgets and the money will have to be raised somehow. Even if millage rates go up, at least the homeowner will be paying based on the current value of their property instead of an inflated value.

May 12, 2009 11:34 PM #1
Charlie Ragonesi - Big Canoe, GA
Homes - Big Canoe, Jasper, North Georgia Pros

Maybe the counties need to be more efficient and change the way they do business. They were quick to raise taxes.

May 12, 2009 11:43 PM #2
Eilean Foster
Keller Williams Realty Atlantic Shore - Egg Harbor City, NJ
Real Estate Agent

With New Jersey cutting back on what funding is being allocated to the municipalities; I know the assessor's office won't be very happy with realtors informing their buyers of this option Joe!

But that isn't going to stop me from telling them!  hehe

Thanks Joe!


May 12, 2009 11:50 PM #3
Eilean Foster
Keller Williams Realty Atlantic Shore - Egg Harbor City, NJ
Real Estate Agent

p.s. You reminded me of a past deal where the client had appealed *won* the tax assessment!

May 12, 2009 11:53 PM #4
Chad Janusa, MBA - New Orleans Real Estate
Metairie, LA

I live right outside of New Orleans, and over the last few years the values that the New Orleans assessors office was giving to properties was outrageous. I did an investment analysis on a duplex property as part of an MBA course, and the assessor's office had a $290k property assessed at over $400k. How they determined that value i'd love to know.

May 13, 2009 12:08 AM #5
John Combs
Alan Deblat Real Estate Corp. - Oceanside, NY

In my  area the dates and rules are different. We are seeing many homeowners file a tax grievance however. Nassau County has high taxes to begin with and when you combine the drop in housing with the economic conditions, there are plenty of good reasons to file an appeal.

May 13, 2009 12:13 AM #6
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