Realtors Fight For Fair Assessments

Why are my property taxes so high? 

These days I'm getting a lot of calls like this, wondering, if there are so many foreclosures, short sales, and home sales are down, why is my assessed valuation still so high?

As you might expect, the answer isn't simple.  Instead of basing taxes on the number of properties in a district, Illinois law bases taxes on the value of properties.  Property taxes are the result of a formula which divides the value of taxable properties in the district by the amount of money a taxing district (think of your school districts, fire district, or mosquito abatement district for example) asks for (called a levy) to produce a tax rate.  The tax rate then is multiplied by the assessed value to determine the amount of property tax per parcel. 

Therefore, a vacant parcel will have lower taxes than a parcel with a home on it. The more expensive the home is, the higher the taxes. At this point the township assessor's office comes into play, they evaluate each parcel, and assign it a market value.  The market value is actually the product of the last three years of market values. Illinois law specifies "the last three years" to help offset any short term fluctuation in the local real estate market, which, until the last few years, worked pretty much as intended.

However, Realtors have seen declines in property value throughout the area since 2007, a full three years ago. However, property taxes have not fallen, nor have assessed valuations because township assessors exclude foreclosures and short sales from their market evaluations.

Realtors think this is wrong and are supporting Senate Bill 3334which amends the Property Tax Code so "compulsory sales" are reflected for the purposes of assessing value.  While this bill currently does not apply to Cook County (which has it's own unique system that classifies property for tax purposes) it would apply to DuPage and the other 100 counties in Illinois.

Realtors believe this, along with pressure from citizens to control the spending of their taxing districts, will help ease property tax burdens on homeowners.

At our recent Capitol Conference we reminded Senators and Representatives that when a homeowner gets a CMA (Comparative Market Analysis)  before selling their home, foreclosures and short sales are tallied as they do have an effect on the local property values.  The State of Illinois must ask assessors and taxing bodies to recognize this harsh reality when reviewing their tax rates and assessment practices.

Comments

[John Reedy]

great post! As we tell our clients it is even more important that you make sure your assessed valuation is not to high because rates will no doubt be rising to reflect the overall declining assessed valuation. If your property is left behind (with a 2005 or 2006 valuation) your tax bill will jump dramaticaly. Way to go in looking out for the consumer.

[Rich Ayers]

I personally disputed my taxes with Kendall county this year. Saved about $900. They DID NOT make it easy though! I had to fight tooth and nail!

Rich Ayers
Broker/Owner
www.AyersTeam.com
Crescent Lake Realty