Perfect Fiscal Storm Threatens Property Taxes
Real estate bust, state deficit could lead to rate increases
RALEIGH (By Anthony Greco, Carolina Journal Online) — The real estate bust threatens to sock homeowners with an unwelcome combination of blows over the next few years, as North Carolina counties undertake the periodic cycle of property revaluation. Counties, cities, and towns have to keep enough money coming in from property taxes to balance their budgets. So when property valuations fall, tax rates either must rise, or local governments must get by with less.
State law requires counties do a revaluation at least every eight years, but counties can decide to revalue more frequently. Mecklenburg is the state’s largest county revaluing its property this year. Between 2005 and 2006, Mecklenburg County’s real estate valuation grew about 4 percent, adding almost $4 billion of property to the tax rolls. Cumulatively, North Carolina counties saw their taxable real estate value grow $95 billion at the peak of the boom, reports the North Carolina Association of County Commissions.
That said, the N.C. Department of Revenue says the counties with the largest spike in value during the boom also are most likely to see the greatest fall in value this year. Brunswick County leads the bunch, with the median home sold having an assessed value of nearly 114 percent of its sales price. The median home sold in Carteret County had an assessed value of nearly 113 percent of its sales price.
Definition: Those homes sold for prices lower than their tax values.
RALEIGH (By Anthony Greco, Carolina Journal Online) — The real estate bust threatens to sock homeowners with an unwelcome combination of blows over the next few years, as North Carolina counties undertake the periodic cycle of property revaluation. Counties, cities, and towns have to keep enough money coming in from property taxes to balance their budgets. So when property valuations fall, tax rates either must rise, or local governments must get by with less.
State law requires counties do a revaluation at least every eight years, but counties can decide to revalue more frequently. Mecklenburg is the state’s largest county revaluing its property this year. Between 2005 and 2006, Mecklenburg County’s real estate valuation grew about 4 percent, adding almost $4 billion of property to the tax rolls. Cumulatively, North Carolina counties saw their taxable real estate value grow $95 billion at the peak of the boom, reports the North Carolina Association of County Commissions.
That said, the N.C. Department of Revenue says the counties with the largest spike in value during the boom also are most likely to see the greatest fall in value this year. Brunswick County leads the bunch, with the median home sold having an assessed value of nearly 114 percent of its sales price. The median home sold in Carteret County had an assessed value of nearly 113 percent of its sales price.
Definition: Those homes sold for prices lower than their tax values.
posted by BP News Bureau | 12:06 PM
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