S#!t Outta Luck: Values Down, Taxes Up
We’ve heard what Elliman, Corcoran and others think happened to prices last year and now we know what Bloomberg et al think: That property values—at least in Clinton Hill—fell 10 percent last year. The assessed value, however, did not decrease in accordance. As previously reported, property taxes are going up 7 percent this year. Ouch….
We’ve heard what Elliman, Corcoran and others think happened to prices last year and now we know what Bloomberg et al think: That property values—at least in Clinton Hill—fell 10 percent last year. The assessed value, however, did not decrease in accordance. As previously reported, property taxes are going up 7 percent this year. Ouch. Update: Crazy Stable is riffing on the same topic.
Thank you David. I’ll have to take a whack at it since the husband unit is useless on that front.
I wonder if we can lower our taxes…
BrooklynGreene — read the materials that came showing how your taxes are figured. Read the comments above. Then figure out whether you would benefit from filing. It’s not hard and it’s all in your materials, as further explained in the comments.
Our market value jumped about $350,000 on the statement we just received! We had a good laugh! I guess that increase is on par with the cheese prices at Greene Grape Provisions! Maybe their prices set the market index for Fort Greene.
Anyway, giggles aside, I have to say I was a bit dumbfounded when I opened the statement and saw this annual increase in market value since all we keep hearing from certain quarters is that sale prices have been going down in 2008. Our “market value” calculated by the City went up by leaps and bounds in 2006 and 2007 as I remember but I would have thought the market value would have been estimated a bit lower now in “this climate”, especially going into 2009 and what some people are calling the Big-D Depression.
Any thoughts out there if there is any need to go to the Finance Dept and complain? Our real estate taxes *have*, indeed, gone up quite a bit under Bloomberg, but I think the assessed value has simply gone up slowly and it is the tax rate that has gone up. Am I correct? Who’s a real estate lawyer out there who knows how all this works?
I’m not exactly sure how the city figures the market values. Brownstoner’s sample above showed a 10% drop in market value, while others are receiving valuations that are still going up. It’s probably bad PR for the city to show increased market values for properties when, at a time like this, it’s pretty clear that values have dropped over the last year. On the other hand, when market values drop and assessed values rise (because they’re still catching up), people like brownstoner complain at the disparity.
Brooklyn Chicken, I know that Detroit and Cincinnati have income taxes (or at least they did 20 years ago when I lived in the Midwest). I suspect some other cities do, too.
BTW, the sample notice [youre, Mr. B.?] doesn’t show an “Exemption Value”. Shouldn’t virtually everyone have the basic STAR exemption?
My “market value”, in Lefferts Manor, went up $62.000 to $983,000. While I’d like to think this REALLY means that property values are going up here, while they’re going down in other brownstone neighborhoods, I think a more likely explanation is that the Dept. of Finance is, as usual, being arbitrary and capricious. AFAIK my assessed value would have gone up the same amount anyway, even if my market value had dropped, so, I guess, it doesn’t matter much.
As a brownstone owner, I agree that the whining about property taxes is extremely unseemly. A 7% increase on a small amount that is a fraction of the real value to begin with is nothing to cry about at all.
But in defense of low property tax, our income comes from art and is therefore lumpy and unpredictable. If we had to pay substantial property tax every year, relating to unrealized gains and losses but not real income, we probably couldn’t make it here. So, low property taxes keep artists and other creative types with fluctuating income in the City. In fact, when we think about moving somewhere else, the property tax is always the deal-killer.
We pay our way with income tax, which more or less tracks our own ups and downs. NYC is the only American city that has its own income tax, yes? (In addition we pay a special unincorporated business tax, 1.5% of income for the privilege of belonging to a group too small to effectively protest.)
There’s another way to tie property tax to real house value without penalizing people who have uneven cash flows. The City could charge a lump tax on the real gain on a sold property. While the city would prefer its money up front, of course, that way it could be repaid for some of the expenditures it made to make this a better place to live.
Quit your whining about your taxes on your Clinton Hill house, Brownstoner.
As explained by David Lewis and others, above, your tax increases are being phased in at the maximum 6% increase a year because your assessed value was under the Class 1 Assessment ratio of 6 percent. Stuff you would know if you read the explanation the NYC DOF sent you with your Annaul Notice of Property Value.
Unless you think your house is worth less than $770,514 (new assessed value/6%) you have no complaints.
If you want to complain about unfairness … the law says that coops and condos are valued as rental properties, so tax has nothing to do with actual market values.