LAKE PLACID – This year’s provisional property assessment rolls are now complete in the Town of North Elba and the Village of Lake Placid, and the rolls show that property values in local residential areas have increased by 11% over the past of the last year.
The city sent out assessment change notices during the last week of April, according to assistant assessor Deb Mueller, putting new assessments in the hands of most homeowners earlier this month. People can view the Tentative Assessment Rolls online at https://co.essex.ny.us/2022TentativeRolls.asp.
City assessor Todd Anthony said the increase in assessment values this year was an unnatural jump from recent years. For example, in 2021, residential property assessment values increased by 6%. Mueller said the pandemic-related housing boom is the main driver for the bigger increase this year.
The higher than usual increase is not isolated to Lake Placid – some other residential areas in Essex County, such as Keene, Wilmington and Jay, saw residential property values increase by 11% or more, according to Mueller. Anthony expects the uptrend to eventually dip, but he said it’s hard to determine when that might happen.
Anthony said he’s heard from residents who are concerned that their taxes will rise with the value of their property assessment. While this may be the case, according to the state Department of Tax and Finance, your assessment could also go up while your taxes go down or stay the same. Assessment values are not taxes — taxes are based on assessment values.
How is the property valued?
Anthony said he was valuing the property by doing a cost analysis – estimating what it would cost to buy a plot of land and get it ready to build a house on. If there is a building or house on the property, Anthony said he depreciates the value of the property based on the age of the building, taking into account whether the building has been rehabilitated or not and handed over at nine.
After performing a cost analysis, Anthony said he was performing a comparable sales analysis. It compares properties with a certain style and quality in a certain neighborhood to similar properties that have recently sold in similar areas. It’s easy to appraise recently sold homes, Anthony said, because the home‘s market value was only determined by the buyer.
Anthony said people told him they felt distinguished by their increased ratings. He said he was trying to be fair looking at all the plots in town.
“I don’t take it out on individuals” Anthony said, “I look at real estate and think, ‘How much would that sell for? “”
The city’s assessment level, or the link between the estimated property value and the market value of the property, remained at 100% of market value “for decades,” said Anthony. Assessing properties at 100% of market value is important because it helps people better assess the accuracy and fairness of their appraisals, according to the state Department of Tax and Finance.
Although this year wasn’t meant to be a full assessment of valuations, Anthony said it ended up being a full reassessment because the real estate market has been so “warm.” He said so much had changed in the market that this year he wanted to value properties with a “finer tooth comb” instead of “slap on a percentage and call it a day.”
Anthony said that if he hadn’t reassessed town and village properties this year, the assessment level could drop from 100% of market value and the state would issue municipalities an equalization rate to bring their appraisals at full market value. If properties were not reassessed this year and assessments were only at 88% of their value, it could be harder for people to determine whether they are being taxed fairly or not.
Assessments vs Taxes
The property taxes you pay begin with the budgets passed in your local school district, municipality, and county by your school boards, town and village councils, and the county legislature. When these councils pass a budget, they determine how much they will collect in property taxes from local ratepayers – called a tax levy – for that fiscal year. The amount that councils can increase a tax levy from year to year is determined by a state-issued tax cap, which is the percentage increase allowed in taxes collected – usually around 2%.
The rate at which a person is taxed is determined by dividing a budget’s tax levy by the total land value of that municipality or district. For example, the Lake Placid Central School District is proposing to collect $16,675,694 in taxes during the 2022-2023 school year. When this levy is divided by the total land value of the district, you get a tax rate of $6.86 per $1,000 of assessed value. A school district taxpayer might calculate their property taxes by multiplying the tax rate by the total assessed value of their property.
Assessed property values move with tax levies, Anthony said, so when assessed values and tax levies rise together, property taxes remain more stable. If Anthony hadn’t reassessed the properties this year, he said, people’s taxes would have gone up by the percentage their school district, county and municipality’s tax increases year over year — the tax ceiling adopted in the budgets of these communities.
Anthony said if your assessment increases this year by more than the average city and town assessed value increase — which he says was 8.6% — you could see an increase in your taxes. You can determine if your rating has increased by more than 8.6% by finding the percentage difference between your previous rating and your new rating. For example, if your home was reassessed at $125,000 and your previous assessment was $100,000, your assessment has increased by 20% and you may see an increase in taxes. If your assessment has increased by a percentage equal to or less than the city’s average increase, Anthony said, you might see no change or a decrease in your taxes, respectively.
Why the increase?
Anthony said that on average residential property valuations have risen 11% this year; the value of vacant land increased by 10%; and trade values increased by 3%. It is across from the town of North Elba and the village of Lake Placid, which includes the hamlet of Ray Brook and parts of the village of Saranac Lake.
Antoine said he “With all my heart” believes that the pandemic-related housing boom has contributed to the rise in valuation values. Strong real estate demand and weak supply have caused market prices to skyrocket during the pandemic. As the number of completed sales begins to decline — an April report from the New York State Association of Realtors showed sales have fallen 7.1% over the past year — average sale prices continue to decline. increase by more than 17%, and the houses for sale remain on the market for fewer and fewer days. NYSAR’s report shows that over the past year, buyers have paid an average of about 0.2% above 100% of market value.
“You have to understand that we are evolving in an active and changing real estate market”, said Anthony. “And I think it’s quite obvious that it’s a growing market.”
Anthony added that pandemic-related inflation on building materials and labor also contributed to the rise in valuations.
Antoine said a “large portion” of new buyers have non-local postcodes. He said some of these people are buying second homes and “evacuation pads”, while others move here. Anthony said it would be a “a bullet in the dark” to estimate the percentage of non-local buyers and how they use the properties.
Anthony also said some people come to the area specifically to buy properties for STR to use. He said they find undervalued plots, buy them, prime them for rental and continue the model with other properties as an investment strategy. When a property is restored to like-new condition, its appraisal value may increase.
For example, this could be the case with an STR conversion that is currently before the Lake Placid-North Elba Review Board. A New York-based property management company, Stay at Lina, wants to convert an old shed on Cascade Road into a two-story, eight-bedroom single-family home for use as an unhosted STR.
Anthony said the growing presence of short-term vacation rentals in the town and village is not to blame for the rise in ratings, but he said it was a factor. A single-family home used as an STR is still a single-family home and would be assessed that way, he added.
Challenge your assessment
Reviewers are required to make appointments to hear people’s complaints and feedback about their reviews, which Anthony is doing this week. Mueller said Anthony’s appointments are full, although people who wish to challenge their rating or are unhappy with their appointment with Anthony can complain to the Ratings Review Board. Council is scheduled to meet Tuesday, May 24 from 1-4 p.m. and 6-9 p.m. at North Elba Town Hall to hear assessment complaints. People who wish to file their grievance before the board must make an appointment by calling the assessor’s office at 518-523-1975.
The Appraisal Review Committee is made up of three people who hear people’s appraisal concerns independently of the appraiser. The council assesses any evidence someone may provide showing that their property has been assessed incorrectly, and the council makes the decision to deny, grant or compromise the person’s request for a re-assessment. If someone is still unhappy with their appraisal value after that, Anthony said, they will take their case to small claims appraisal review.
People can learn more about grief from their reviews at https://tinyurl.com/2p97434y.