How is Property Value Assessed?
Property value includes both the value of the land and improvements thereon. might be a lot in a neighborhood, a 5-acre shopping center site, or 100 acres of woods. Improvements include both buildings and structures, as well as site improvements such as parking lots, pools, patios, and/or other features that add value to your property. It is important for property owners to use the County Tax Assessor’s to confirm that the County valued property based on the correct acreage and improvements.
The Counties will use prior sales from 2020, 2021, and 2022 to determine the New Value, and that is what your property tax bill for 2023 until the next Revaluation Year will be based upon. The County cannot increase or decrease the New Value based on changes in market values between Revaluation Years.
Given that the market has seen unprecedented highs in values over the past couple of years, we can expect to see a significant increase in both commercial and residential New Values. For example, when Union County revalued its property in 2021, real estate tax values increased an average of 35%, with property owners seeing a corresponding increase in property taxes.
Can You Appeal Your Property Value?
If the County’s New Value substantially exceeds what your property is actually worth, you have the right to appeal the New Value either through an informal appeal process or directly to the Board of Equalization and Review. An appeal to the Board of Equalization and Review is a quasi-judicial process. This means that the Board acts as a judge or jury and renders its decision based on material, competent and substantial evidence presented during the Hearing. In making its decision, the Board has the authority to reduce the New Value, increase the New Value, or confirm the New Value. If you are dissatisfied with the Board of Equalization and Review’s decision, you have the right to appeal the Board’s decision to the Property Tax Commission in Raleigh. If your appeal is successful, the resulting reduced New Value will be used to calculate your property taxes until the next Revaluation Year.
Whether or not to appeal depends on a variety of factors, including property type, the amount by which the New Value exceeds the current market value, and how much in tax savings you can expect to receive from the desired reduction. You should consider your time, as well as the costs and expenses associated with mounting an appeal.
You should know that you can only challenge the New Value based on market value during the 2023 Revaluation Year. The New Value can be appealed in 2024 or after; however, the reasons to appeal between Revaluation years are limited. You can appeal the New Value if, for example, the County based the New Value on incorrect information, or a change has occurred on your property. You cannot appeal between Revaluation years because you sold property for less than tax value, or because the real estate market has declined.