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photo by Heather Renee_____
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photo by Heather Renee_____ |
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Waterfront Taxes The 2008 revaluation shocked a lot of waterfront residents. Many saw valuation increases of more than 100%. But upon further review, the TOTAL valuation of waterfront property was about right. What was badly done was the allocation. While the county tax department used complicated formulas to value waterfront LAND, they would have gotten a similar result just by adding about $300,000 to the value of each waterfront lot. The net result is valuations that impacted the lower-value (and likely the lower-income owners) much more than the higher-value. The percentage increases go down as the value goes up, instead of being constant. The 2011 revaluation did a slightly better job of allocation amongst similar properties, but inequities still exist. The Tax Dept seems dedicated to keeping valuations high, to the extent that they arbitrarily disqualify (officially ignore) sales that lower the "sales comps".
State law requires that valuations be based on "market value". Bricks and mortar are fairly easy to value -- assessors have lots of experience in many jurisdictions. But waterfront land is rare, and to raise the values by a fixed dollar amount doesn't seem to make sense. That this is wrong is shown by an analysis of the last waterfront development to sell raw land in any quantity -- Norman Estates. A benchmark lot, one of the most expensive when sold, was used, and all of the other lots compared. The other lots sold for between 41% and 100% of the benchmark, BUT the tax department valued the lots at between 59% and 115% of the benchmark. Expressed another way, the highest-priced lot gained 39%, the lowest gained 100%. That experience was repeated throughout the waterfront. Details can be found here.
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