Important
News
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Property Taxes and the Real Estate Market By |
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| Due to the present downturn in the real estate market and the ongoing media coverage of it, property owners believe there has been a severe loss of property values in our township. The property tax system is a complex process, and when one adds in the currently challenged real estate market, the process becomes even more difficult to understand.
Despite the reports of housing values plunging downward, foreclosures at an all-time high, and homes simply not selling at seemingly any price, property taxes continue to rise. This is a very challenging concept for property owners to accept. Though most of our 2011 assessments are lower than last year, many homeowners still might feel that our office is not properly reacting to market conditions. The Assessor is responsible for assessing property at one-third of the fair market value. Properties are valued as of January 1st of each year. However, the county and the state monitor assessor values so that values throughout the county and state are equitably assessed. The formulas that are used to measure our accuracy and equity always include consideration of actual sales over a three-year period as required by law. Therefore, when our office valued properties for January 1st, 2011, we were obligated by law to look back at the sales that took place during 2008, 2009, and 2010. We are not permitted to just look at the marketplace that existed on January 1st, 2011. Below is a chart of the sales activity in Bloomingdale Township for the past seven years. As you can see, the market was in a rising trend during 2004, and 2005, but in 2006 and 2007 it appeared to stabilize. In 2008, we experienced the first real decline in the median sales price of homes. Additionally, state law does not allow our office to consider non-arm's-length sales, |
such as foreclosures or short sales made under duress.
This year is a Quadrennial Year, also known as a General Reassessment Year. By statute, every four years is a General Reassessment Year, during which we must review and reassess all properties in our jurisdiction. For 2011, we were obligated to look at sales from the years 2008, 2009, and 2010. Additionally, the 2007 sales have dropped out of the statutory three-year sales study, which allowed some assessments to decrease further. If the current market trend continues, we can anticipate that most properties will be at a lower value in 2012. Most importantly, everyone should understand that regardless of what happens in the marketplace, even if assessments are reduced this would not necessarily mean that property taxes would go down. Please remember that property taxes pay for local services, such as schools, parks, police, and fire protection, and if these local taxing units continue to provide services and increase spending, then property taxes will continue to increase. Please know that our office is painfully aware of the challenges being faced by those who are trying to sell their home in this very difficult market. We will continue to monitor the sales activity in our Township and next year, based on that market, we will calculate assessments as of Jan. 1, 2012, as measured over a three-year period (2009, 2010, 2011) as required by State law. We hope this bulletin helps explain the assessment process and how it relates to current housing market conditions. |
| YEAR | NO. OF SALES | MEDIAN SALE | AVERAGE SALE | SALES RANGE |
|---|---|---|---|---|
2004 |
2386 |
210,000 |
234,139 |
60,000 to 1,240,000 |
2005 |
2860 |
231,000 |
254,750 |
70,000 to 1,350,000 |
2006 |
2846 |
230,000 |
248,449 |
78,500 to 1,275,000 |
2007 |
1797 |
230,500 |
252,300 |
72,000 to 1,350,000 |
2008 |
1155 |
215,000 |
242,720 |
70,000 to 1,250,000 |
2009 |
1151 |
183,900 |
205,330 |
59,000 to 935,000 |
2010 |
1358 |
163,440 |
189,723 |
33,000 to 1,189,890 |