Are Our Taxes Too High or Too Low?
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Are your property taxes too high or too low? The county wants to know.
The Seattle Times had an article today about property taxes. The article: Assessor asks: Were tax bills too low? Is obviously an attempt to raise more money for the county
Lloyd Hara, King County Assessor says his office is looking into the following categories:
- properties on which assessed values didn't change from one year to the next amid a volatile housing market
- properties valued below the price for which they sold
- "personal property" such as art collections on which corporations and wealthy individuals may have failed to pay tax.
But I ask, why not look into properties valued above what they sold for at the same time? If you can back charge some property owners, as the article suggests, do you refund others who have sold, or would the refund go to the current property owner?
A former tax assessor, Harley Hoppe, has been assisting Hara with his efforts to resolve the tax deficit that looms for next year. Hoppe “said he is personally aware of "thousands" of undervalued properties. As part of his consulting business, Hoppe monitors assessment records and property sales.
I have another question. Doesn’t the county monitor assessment records and property sales? Why haven’t they come up with something before now? And what are the figures?
I did a little tax search myself this morning using tax information available through the NWMLS. I took a typical home in the Ravenna Wedgwood area which sold recently. Then I asked for 50 comparable sales within 2 miles of this property that sold and closed any time since January 1, 2009. The tax data gives both the assessed value and the sold price and well as the assessed value ratio and other information. Here is that document.
I averaged the assessed value ratios and came up with 0.943438. To me that means that in a sampling of 50 properties in a typical Seattle neighborhood, the average sales price was only 93.4% of the assessed value. If homes are selling for less than assessed value, then the assessed value is too high.
If someone knows of, and tells the assessor that there are thousands of under-assessed properties in King County, then by all means, find out why that is so, and go to the people that under-assessed those properties and find out why. It doesn’t seem to me that the fault lies with the property owners that were under-assessed. What do you think?
Glenn Roberts, SRES*
Lake and Company Real Estate
206-524-3665
Seattle Residential ~ I Do That
Licensed broker since 1985 offering spectacular service to buyers and sellers in greater Seattle, with particular interest in Green Lake, Ballard, Phinney Ridge, Wallingford, Ravenna, Bryant, View Ridge, Roosevelt and the University District.
*Senior Real Estate Specialist
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Taxes are a double edge sword. We need safe streets and good schools but when you see that 127 public employees in King County make over $100k per year and all the public employees got a 2.5% pay raise this year, it isn't funny. The days of 7 county workers supervising 1 person with a broom are not funny anymore! Others in the private sector are losing their jobs while we give pay raises. Work 25 years and retire with 70% of your salary and full medical, some at 56 years old, for the rest of their lives. The foxes are in charge of the hen house Glenn!
Paul - I think there will be a lot of community action as they disclose how their ineptitude causes the need for more money. We may not be able to stop big banks and wall street companies from giving big bonuses, but we can accomplish amazing feats in our local governments.
Glenn, I often pull comps and show the difference between assessed values and actual closed sales, because clients sometimes use assessed values as rationale for or against buying or selling at a particular price, which I strongly discourage. The range of differentials is usually striking. For example, I pulled 8 reasonable sold comps for a client last summer. One of them sold at 70% above assessed value, one at 56% below assessed value, and the others were scattered everywhere in between. If the assessor wants to cure the gaps on one side, then the gaps on the other side need to be cured. And if property taxes have to be such a big part of the revenue equation, then refining the process of making them more accurate and fair should be a high priority.