Midvalley warned to brace for higher valuations
ASPEN – Midvalley homeowners will likely experience sticker shock when their new property valuations arrive in the first week of May, according to the assessors of Eagle and Pitkin counties.
Although the recession has crippled the local real estate industry, the new valuations will reflect about a 38 percent increase for single-family homes in Basalt and El Jebel, Eagle County Assessor Mark Chapin said. Condominium values soared by as much as 75 percent, he said.
Larry Fite, senior appraiser for Pitkin County, said midvalley property in Pitkin County went up by similar amounts since the last valuation in May 2007.
Both offices have gone on the offensive to explain what is happening ” and to try to blunt criticism ” before the notices get mailed to property owners May 1. Chapin said many property owners will probably ask, “What the heck is the assessor thinking?”
Colorado law requires the county assessors to reassess property every two years. The current reassessment reflects real estate market activity from Jan. 1, 2007, through June 30, 2008. The reappraisal reflects the market value as of June 30, 2008.
Fite noted that the 18-month period used for the reassessment coincided with a dramatic appreciation in property values. That drastic appreciation coupled with perceptions about what the market is doing now in the recession creates a public relations problem for his office.
Chapin has been holding meetings with elected bodies and civic groups in recent weeks to prepare them for the high values. Pitkin County Assessor Tom Isaac wrote an open letter to the public explaining the process and warning people about what they will find.
Nevertheless, many homeowners will likely be caught off guard when they receive their notices.
“As people tend to be ” until it’s right in front of you, you don’t even notice,” Chapin said.
In the reassessment undertaken in 2007, values in the Basalt and El Jebel portion of Eagle County didn’t increase as much as Eagle County as a whole. This time around, midvalley prices will appreciate more than the county as a whole.
Chapin said that reflects what occurred in the Aspen-influenced Roaring Fork Valley real estate market. High demand and low supply sent prices soaring in 2007 and 2008 in midvalley and downvalley areas that were more affordable than the upper valley.
For Eagle County as a whole, the median increase in single-family home values for this reassessment is 13 percent, Chapin said. But the median increase for single-family homes in the Basalt/El Jebel portion of the county is 38 percent. The towns of Eagle and Gypsum, traditionally the more affordable areas of the Eagle Valley, also experienced more drastic increases than the county as a whole.
The skyrocketing valuations have implications for tax bills. The actual value determined by the assessor is the foundation in the formula used to figure property taxes. The 2009 reassessment will be used for tax bills in 2010 and 2011.
“The bottom line is we all need to be prepared for a pretty big hit next year,” Basalt Councilman Chris Seldin said after Chapin informed the board about the soaring values in Basalt.
Homeowners who may be struggling with reduced wages or unemployment will likely get hit next year with a bigger tax bill. Commercial property will also go up, translating into higher rents or operating costs.
Chapin noted that Eagle County government is responsible for only about 10 percent of the property tax bill in that county. Special taxing districts that include schools and fire departments comprise the bulk of the bills. Some of those districts have removed property tax caps ” a process known as de-Brucing ” so they could score a windfall in extra tax revenues if their boards don’t voluntarily lower their tax rate.
The government budget process ” which usually draws little public scrutiny ” will be magnified in importance for 2010 and 2011.
Chapin said the notices that property owners will receive in May have information on how to file an appeal of their valuations. Appeal hearings will be held starting in May at the Eagle County building in El Jebel on Tuesdays and Wednesdays. Chapin stressed that property owners must use sales data from Jan. 1, 2007 through June 30, 2008, for their appeals.
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