Property Values to be reassessed for Jan 1, 2013

Currituck residents enjoy a very reasonable tax rate compared to many other Counties and Towns across the country as we can depend on visitors infusing the County with money via sales tax, occupancy tax, second/rental home property tax, and a demand for services that fuels employment needs. This luxury relieves the county (mostly) of having to internally generate these revenue streams like so many other counties that don't have a high visitor base to help foot the bill for services, schools, etc..

The County reassesses the real estate property values every 8 years, the last being in 2005, where values were at their peak. The Currituck Outer Banks values shot up the most, thus the majority of the tax revenues came from the vacation homes. With the reassessment of property values set to occur Jan 1, 2013, those same beach properties will likely be assessed much lower since they have fallen considerably in value during the downward shift in the economy. Two things will likely occur, mainland Currituck will account for a larger portion of the revenue percentage and the tax rate will go up to cover the spread on the budget in 2013. Cindy Beamon of the Daily Advance has picked up on some of this and her article is below

Currituck land values likely to decline in new valuation

By Cindy Beamon

The Daily Advance

Friday, June 3, 2011

More New property valuations will not take effect in Currituck until 2013, but the process starts this summer to update land appraisals.

Landowners can expect appraisers to begin visiting properties in July or August, said County Manager Dan Scanlon. The process will take about a year, and by next summer, residents should be mailed the new values. Residents will then have a chance to appeal the evaluations before they take effect, Scanlon said.

Even before the new appraisals begin, county officials are predicting that land values will be down. The county’s last evaluation eight years ago was at the height of a housing boom, and property values have dropped significantly since then.

Property values on the Outer Banks, harder hit by the real estate market’s decline, are expected to drop more dramatically than on the mainland.

The uneven drop in property values is likely to shift more of the tax burden to the mainland, Scanlon predicted. At present, Corolla provides about 56 percent of the county’s property tax income, but the steep drop in values on the Outer Banks is likely to reduce that percentage, he said. The overall effect will be that property owners on the mainland will be paying a greater portion of property taxes in the county.

Another possible effect of the decreased property values would be an increase in the county tax rate.

At present, property owners pay 32 cents per $100 valuation. For a property owner with land valued at $100,000, the tax would be $320. If the landowner’s property value drops 20 percent with the new valuation, the same property valued at $80,000 would generate $256 in taxes.

The overall effect countywide, would be less income for governmental services. To compensate for the loss, the county will need to raise property taxes to generate the same revenue, Scanlon explained.

“We would have to raise the tax rate to maintain the same level of services,” he said.

The effect on individual taxpayers would depend on the new tax rate and how much their property decreases in value.

Property owners on the Outer Banks where land values are expected to drop the most are less likely to see their bills go up as the tax rate goes up.

Property owners on the mainland where values are expected drop less dramatically are more likely to see their tax bills go up as the tax rate rises.