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This article is reproduced from the Bloomingdale Township Illinois Chief Deputy assessor John Dabrowski. This explains why even though your home may have lost value in our current market conditions, but your taxes still may go up. This only applies to the state of Illinois, though some states may apply similar procedures. Property Taxes and the Real Estate Market By
John Dabrowski, Chief Deputy Assessor - Residential |
Due to the present downturn in the real estate market and the ongoing media coverage, property owners believe there has been a severe loss of market value in 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. Many homeowners must 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, 2007, we were obligated to look back at the sales that took place during 2006, 2005, and 2004. We are not permitted to just look at the market place that existed on January 1st, 2007.
Below, is a chart of sales activity in Bloomingdalesales prices Township for the past five years. As you can see, the market was in a rising trend during 2003, 2004, and 2005. But in 2006 it appeared to stabilize and in 2007 the number of sales dropped off sharply, however, the sales | prices continued to be stable. There is no indication in our township of excessive decrease in property values as measured by the actual sales taking place. The law also does not allow our office to consider non-arms-length sales such as foreclosures.
All of this simply means that there can be no immediate reduction of assessments based on the available data and the current laws that govern the process. The data does show a definite slowdown in the local market particularly in the number of homes sold. Please be assured that our office will continue to closely monitor the sales activity in the market and adjust assessments accordingly.
Most importantly, everyone should understand that regardless of what happens in the market place and even if assessments were to be reduced, this does not mean that property taxes will go down. Please remember that property taxes pay for local services such as schools, parks, police, fire protection, and if these local 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 sale activity in our township and calculate the assessments based on that market, as measured over a 3-year period (as required by state law). For the assessment date January 1, 2008, we will look at sales in 2007, 2006, and 2005.
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 |
|---|
2003 | 2756 | 195,000 | 216,878, | 56,000 to 1,139,000 | 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 |
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