With hot home market, assessments will be rising | Local News | Ezine Daddy

On the heels of a coveted real estate market that has seen Vigo County home sales prices rise by 19% to nearly 26%, property tax assessments have also risen.

Vigo County’s real estate appraisals increased by more than $515.2 million between 2021 and 2022. The district’s total estimated value increased to more than $6.79 billion from more than $6.27 billion.

The new assessments mean that property owners will have to reckon with higher taxes in the future.

“Realistically, we can all expect to pay a little more tax next year based on the estimates,” said Kevin Gardner, Assessor of Vigo County. “But it won’t be as bad as the assessment looks.”

That’s because Indiana’s property taxes were capped in 2008, limiting an owner’s property tax burden to a fixed percentage of the appraised gross value of the property.

Home ownership taxes are capped at 1% of property value, while apartments and agricultural structures are capped at 2%. Commercial and all other properties are capped at 3%.

For example, if a $200,000 home went up to $220,000, “then the owner would pay no more than 1% of $20,000,” which is the increase in appraised value, or $200, said Gardner.

“I’ve had people call me saying my estimate went up $1,500 and I can’t afford $1,500 in taxes. Well it isn’t. That’s the asset valuation, and your tax is based on that,” he said.

“We’re supposed to have market value in valuations,” Gardner said. “Our valuation is meant to be what you are selling (your property) for in today’s market,” Gardner said. “We know this has been a crazy market, especially for housing. It doesn’t matter, we’re still supposed to be in the market so our reviews must follow. And as that market cools, our valuations should follow,” he said.

Developer Rick Jenkins said he believes the housing market will cool off, especially as many buyers are paying cash for homes.

“People are starting to pay more for a mortgage and the stock market has gone down so people who pay cash can’t pay as much because their wealth is shrinking,” Jenkins said.

Troy Helman said home sales prices are up 19% in 2021 and nearly 26% so far this year. Helman is a member of the Indiana Real Estate Commission and a broker for Coldwell Banker Real Estate Group, which has 60 offices in four states – Wisconsin, Michigan, Illinois and Indiana.

“It’s not uncommon to have a $120,000 house and have someone pay $150,000 for that house,” which is a 25% increase, “and have eight offers” on the house.

“Common sense tells you that (the housing market) needs to cool down, but I don’t see any major changes in the housing stock in the near future. I don’t see anything that would bring more housing onto the market,” Helman said. “There may be fewer buyers, but there will still be higher demand because the housing stock is so low, it’s desperately low,” he said.

“I don’t see any change in stock levels at all in the near future and we will be low on stock for a while. But you can’t help but think that rising interest rates will slow down the housing market, for what seems like common sense. But I can say at this point that this is not the case. We still have homes with multiple listings where buyers pay more than the asking price.

The property tax notices were sent out on April 29th and more property owners received them on May 1st. The assessment notice is called Form 11, which shows the value of land and buildings and any changes from the previous year.

Looking at Vigo County’s assessment for 2022, which is included in a calculation for a tax bill payable in 2023, the housing assessment increases ranged from 4.5 to 9.5 percent, while the business tax assessments ranged from 11.5 to 17 percent were down, Gardner said.

The nationwide aggregate increases show that home property tax bills are up 8.1%, while commercial property tax bills are up 9.1%.

Appraised values ​​for residential real estate rose to more than US$3.97 billion in 2022 from more than US$3.68 billion in 2021, while commercial real estate rose to more than US$1.39 billion for 2022 more than $1.27 billion in 2021.

“This is based on construction costs and new (cost) tables given to us by the state,” Gardner said.

Agricultural property valuations rose 13%.

“The state increased agricultural land (estimated value) from $1,290 per acre to $1,500 per acre,” Gardner said, “so arable land went up.”

Estimated agricultural land values ​​in the county increased from $393,443,000 in 2021 to $444,546,200 in 2022.

While ratings are increasing, the percentage of each rating category remains nearly the same, with the exception of agriculture.

Residential property appraisals account for 59% of the county’s total appraised value, with commercial property accounting for 20%. Agricultural estimates increased from 6% to 7% of the county’s total estimated value.

State and tax-exempt property represents a large portion of appraised value that is not taxed.

“We have an estimated value of nearly $1 billion between government agencies, churches, schools and colleges, and nonprofits” that are not taxed, Gardner said.

While tax-exempt land valuations rose 5.4%, their share of the county’s overall valuation fell from 15% to 14% as farmland valuations increased. The tax-exempt asset valuation increased from $924,255,500 in 2021 to $974,513,600 for 2022.

What homeowners will pay in taxes next year is based on estimates and government budgets, which have typically increased to the maximum levy since property taxes were capped, which then set a property tax rate.

However, property owners pay different amounts of tax based on property tax deductions, such as B. Homeowner deduction, mortgage deduction if a homeowner is over 65 or is a disabled person, among others, which can lower a final tax bill.

Reporter Howard Greninger can be reached at 812-231-4204 or at howard.greninger@tribstar.com. Follow @TribStarHoward on Twitter.

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