Fayetteville Arkansas, University of Arkansas--Old Main Overview

Fayetteville Arkansas, University of Arkansas--Old Main Overview
Overview of Fayetteville, AR

Saturday, July 12, 2008

Is Your Home Over-Appraised?

By law in Arkansas, each county must appraise all real estate every three years. When values are increasing, as they have been in NW Arkansas for many years, that timetable actually gives a break to property owners. A home appraised at $125,000 in 2004 stayed at that appraised value in years 2005 and 2006 even as the actual value increased to $150,000 or more.

Washington County completed its reappraisals in 2007, which in retrospect appears to be when property values hit the top.

Since then, some properties have actually lost value. I know because my old home, which I just sold in May, was appraised by the county for tax purposes at $195,000. I had it listed in the MLS for $179,900. It sold for slightly less.

Speculators have gone elsewhere looking for the next boom and left behind empty homes and empty lots. Builders desperate to get out from under their construction loans are pricing homes on the lower end of any price ranges of recently sold similar homes.

With the next appraisal in Washington County not set to occur until 2010, the county assessor has taken the unusual step of asking and receiving permission of the county’s Equalization Board to examine the situation.

There are more than 90,000 properties in the county and not all properties will be reexamined.
The target will most likely be subdivisions with homes costing more than $200,000. The plan is to compare homes sold in those subdivisions with the appraised value assigned in the same neighborhood on Jan. 1, 2007.

For example, if a home appraised at $200,000 actually sold for $190,000 and that pattern is repeated on several homes in the neighborhood, the appraised value would drop $10,000. A reduction of that amount would decrease property taxes by roughly $100. (Annual property taxes are about 1 percent of a home’s value.)

In my opinion, this is the fair thing to do and I commend Washington County for taking the high road. Things would probably work themselves out at the next scheduled reappraisals in 2010, but meanwhile some people would be paying more than their fair share of taxes.

Incidentally, properties in Benton County are currently undergoing their scheduled reappraisals, which will set property values beginning Jan. 1, 2009. We would expect those values to be indicative of current values.

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