Dooley Real Estate
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REVALUATION TIME AGAIN

by Paul Dooley

Kent, along with the neighboring towns of Sharon and Sherman, will be conducting its required revaluation of property this summer for the October 2013 Grand List (which will be the basis for tax bills due in July of 2014). Like all Connecticut towns, Kent is required by statute to perform a revaluation every five years. A full field (meaning that the Assessor and the revaluation company actually inspect each property) revaluation must be conducted each ten years. Kent’s most recent revaluation in 2008 was such a process. Intervening five-year revaluations involve analysis of market data (what has sold and for what prices) and applying these value trends to the physical property descriptions created during the last full field process.

So what can we expect? Historically, real property values increase significantly in the five years between revaluations. This year’s revaluation, however, comes at a time when property values have declined, on average, by around 30 percent which is likely to result in reduced assessments. No, your taxes will not in all probability go down.

Two things cause real estate taxes to rise and fall: (1) changes in the municipal budget which is adopted at the Town Budget Meeting in the late spring (taxes in non-revaluation years tend to rise incrementally by approximately the same percentage that the budget increases), or (2) when a revaluation results in an assessment for your property that is increased (or decreased) by a percentage greater (or less) than the amount by which the total of all assessments (the Grand List) changes.

The Assessor will point out that the assessments for individual properties may rise or fall by amounts greater (or less) than those of different types of property. For example, condominium units have been hard hit by the recession. Kent Hills units that sold in the $250,000 range five years ago have recently sold in the $120,000 to $150,000 range. It’s not unreasonable to expect that their assessments may fall by a greater percentage than the Grand List—which could mean a reduced tax bill. On the other hand, well-designed and maintained second homes may have dropped by less than the average. It’s hard to tell at this point.

The good news is that the current Grand List has actually increased by around $6 million--an increase caused by the recent sales of land which had been assessed at greatly reduced rates as PA 490 forest and farm land, causing their assessments to revert after the sale to the underlying, unprotected amounts. (See PA 490 explained).

So the first thing to do when you receive a revaluation notice next winter is to find out by how much the new Grand List has risen or fallen by calling us or the Assessor. If the change to your assessment is similar to that of the Grand List, your taxes shouldn’t change significantly. If the Grand List drops by a much greater percentage than the assessment on your property, you may want to question it (there’s a formal appeals process). Just remember when you get your assessment notice that your taxes are not going to rise or fall by the same amount as the change in your assessment since the tax rate will rise or drop to reflect the new total tax base.


 

 

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