Revaluation--Will Your Charlotte Area Property Taxes Go Up or Down?
Revaluation—Will Your Charlotte Area Property Taxes Go Up or Down?
Property taxes. Going up or going down? Anyone who owns real estate in the Charlotte area or who is considering a Charlotte NC relocation should be interested in the revaluation process.
Why?
North Carolina requires counties to reappraise all real estate at least once every eight years to determine the current market value. Mecklenburg County is in the process of completing the revaluation process for the first time since 2003. Notices of the new assessed values will go out in January 2011. Union County just announced that it will reappraise all properties within its borders in 2012. Its last revaluation was in 2008.
The outcome of the revaluation process will be very different in these two counties. Revaluation is supposed to bring property values back into proportion so that each property owner pays an equitable share of the taxes based on the value of his property. Assessed values in Mecklenburg County are out of balance because of the lengthy time period since the last revaluation. Owners of homes older than eight years have been paying relatively less in taxes than those who purchased brand new homes during the period. When completed new homes were given values consistent with their completion date. Owners of the newest homes have been paying proportionately more in property taxes than those whose assessed values are based on the 2003 market values.
The problem in Union County NC is that the last reassessment took place in 2008 based on 2007 market values. Real estate market values peaked in 2007 and began to decline thereafter. Union County property owners feel that their taxes are too high because today’s market values are generally below the assessed values from 2008. A 2012 revaluation should address those inequities.
Will individual property taxes go up or down when revaluation is complete? It depends.
A property’s annual taxes are determined by multiplying the assessed value by the tax rate set by the county each year. The county commissioners adopt a budget and then set the tax rate to fund the budget. After revaluation, they try to set a tax rate that is “revenue neutral”. Revenue neutral means that the total assessed values of county property times the tax rate will bring in the same revenues as the pre-revaluation tax rate.
In Union County, the Tax Administrator estimates that the 2012 reassessment, if conducted today, would result in a 10% decline in the tax base. The tax rate would have to rise by approximately 7 cents to offset the decreased revenues.
When revaluation is complete in Mecklenburg County, most assessed values will go up but the tax rate is likely to decline to create a revenue neutral tax year. In Union County, the assessed values will likely go down but the tax rate may have to rise to be revenue neutral.
Will property taxes be going up or going down? Unfortunately, the impact of revaluation on individual property owners remains to be seen.
Learn more about property taxes in Union County.
Want to know more about real estate and living in Charlotte and its small towns? Visit www.CarolinaSmallTownLiving.com.
Copyright 2010. Carol Fox. Allen Tate Realtors. *Revaluation—Will Your Charlotte Area Property Taxes Go Up or Down*