The Castle and the Tax Man

You know the saying about our homes being our castle; it sort of feels that way after receiving my 2007 property valuation in the mail yesterday. The full cash value was almost twice the amount of the 2006 full cash value. The AZ Republic has a couple of articles on this topic today, including this editorial:

Brace yourself for a case of strong heartburn - and hopefully not a heart attack - when you open the envelope sent by Maricopa County Assessor Keith Russell.

Property valuation notices were mailed Monday to all property owners. And the assessments reflect the torrid appreciation of homes, up 51.78 percent in the county.

That's a staggering increase, and Russell is well aware that the raw numbers will provoke attention, concern, anxiety, outrage, glee, questions - take your pick. So much so that he felt compelled to insert in the mailing an explanatory note of frequently asked questions.

Russell also has added extra staff to handle a special telephone hotline for questions or if you want to appeal the valuation. That number is (602) 506-3406.

The percentage increase in valuations ranges from a high of 69 percent in Ahwatukee, where the median value of a single-family home shot up to $272,000 from $161,000, to a low of 6.42 percent in Gila Bend. There, the rise in valuation reflected a median home value that increased to $50,000 from $46,983. The last time residential properties were assessed was two years ago.

What does all this mean?

It means that as your home appreciates in value you likely have more equity. That's good if you want to sell.

It also likely means that your taxes likely will go up. But, of course, they would have anyway because government services cost more with inflation and growth.

The question everyone wants answered is: Just how much larger will the tax bill be?

That won't be known for about 18 months, no matter what scaremongers might say. That's because the tax rates for the county, cities, school districts, and the Maricopa County Community College and Flood Control districts, among others, won't be set until August 2007.

That's some time off. And by the time county Treasurer David Schweikert sends out the actual tax bill, the angst over these latest valuation increases will probably be supplanted by the cold reality of a new property-tax bill.

Property values are rising throughout the valley; but Morrison Ranch homeowners have seen their values skyrocket over the last 5 years. This is great if you are ready to sell and move to Timbuktu; and I guess it's pretty good if you want to take some equity out via a home-equity loan (though as a conservative CPA, I'm always cautious about that route). But if your plan is to stay in Morrison Ranch for many years, as mine is, then that number just becomes a feel-good number. And a painful number when the property tax bill arrives.

The arrival of these assessments means a gigantic influx of mail for Bias For Action, our office property tax expert; I am amazed at how many businesses have sprung up for the sole purpose of helping you fight your assessments. We still farm most of our land, and so there are many many parcels, which translates into many many property valuation forms, and many many mail offers to question the assessor.

As long as we're on the topic, I stumbled across a site that gives you an instant fair market value for your house, along with a satellite photo. It's a beta site, and let me stress that this is just for fun, as I have no idea how accurate it is; but check out zillow.com and see what your house might be worth. Mine showed twenty percent more value than my 2007 property valuation; so please don't tell Keith Russell (Maricopa County Assessor) about this website!