...at least that is what some local counties are saying to home owners.
I get a call at least once a week with an upset home owner asking if I could let them know what their home is worth. Frightened of this upside-down real estate market, home owners this last week have been receiving their 2008 tax bills in the mail. They don't like what they see.
For many, their tax assessment is valued for more than the house could sell for if it became available for sale. Some are even $100,000 less than the assessed value. So what is to be done?
For now, nothing.
Counties like Dakota County, understand that home owners are upset, but there is little they can do right now. With budgets sky rocketing over the last five years, cities have been enjoying the financial wind fall brought to them through higher property taxes. Now that property values are declining, cities have to awaken to the fact their annual budgets are going to decrease over the next few years. Of course, they can't raise property taxes to find the revenue, right?
We all know that once a government gets our money, they don't just give it back freely, or without a fight. Minnesota law requires that county assessors only take into account the previous 12 months of sales when looking at real estate values. So as time moves on, the declining value indicated by sales will eventually be shown though property taxes. However it could take two years before anyone sees relief.
Homeowners can appeal their local assessor and ask for a revaluation. I have known some people who have successfully got their property taxes down because they asked. So if you find yourself having a heart attack after opening up your tax bill, either call the tax assessor, or wait a year or two for the counties to get around to recalculating your bill. Either way, it won't be an easy task.