Loudoun Real Estate Assessments, Assessed Values and Appeal Process FAQs

I spent part of yesterday at the Dulles Area Association of REALTORS(R) for a presentation given by Todd Kaufman, Loudoun County Assessor (pictured above), regarding Loudoun County real estate assessments and the appeal process. Speaking alongside Todd Kaufman were Jennifer Sanderson, Operations Manager for the Loudoun County Assessor’s Office and Jim White, Supervising Appraiser, Ashburn Office, Residential Division.

Here are some of the highlights of the presentation and what they had to say…

2010 Loudoun County Real Estate Assessment Overview – Todd Kaufman, Loudoun County Assessor

• The Loudoun County Assessor’s Office revised their mission statement – “biggest change and push is customer service”
• Hard to fight budget and tax rate as an individual through court system, but easier to appeal tax assessment
• Different classification of properties (7 total) based on type, use, density, acreage, etc
• Tax rate is the same for all areas and properties except for Route 28 corridor (commercial)
• Loudoun County real estate assessment is down overall, but much less of a decline in 2009 than previous years
• Some areas in Loudoun such as Sugarland Run saw an increase in the average assessed value
• 64% of Loudoun County’s tax base comes from residential property. About 20% comes from commercial/industrial property
• Loudoun’s residential tax base is down almost 10% over last 5 years while commercial is up about 5% over same period
• Dulles District is by far the number one area for tax revenue/base (mainly because it has the most number of residential properties located within it)
• Overall change in real property assessments in Loudoun County – declined 3.29% ($1.97B) from 2009 to 2010
• Change in “equalized” value – down average of 4.79%
• Loudoun County new construction/growth up $569M in 2009 to $899.6M in 2009, but down from almost $5B 5 years ago (during the boom market)
• 25,000 parcels (aka lots) are ready for development in Loudoun County
• “2010 assessed values show sign of recovery”
• Average assessed value in Loudoun County is $354,000 (not to be confused with market value or average sales price)
• Assessed values up almost 500 percent since 1992. Rapid upswing from 2001 to 2006 and then sharp decline to 2009. Slight decrease in 2010. “Hoping for stabilization moving forward”
• Loudoun County has $4.8B in total assessed value in exempt properties
• Howard Hughes Medical Center is tax exempt, but gives $1M to schools and $200K to fire/rescue on their own (completely voluntary)
• Loudoun has 1600 foreclosures in 2009
• Decline in foreclosures, but increase in short-sales
• Most number of foreclosures in 2009 were in Sterling (which only has 7000 parcels/homes). Dulles District was number two, but it has 30,000 parcels/properties. Overall number of foreclosures is diminishing overall though
• 30 year old system being used to determine Loudoun County assessed values
• Each assessor in the Loudoun County Assessor’s Office is responsible for assessing an average of 7,000 properties (between the 30 year old system and 7,000 per person work load, no wonder it’s hard to get the assessed values right)

Louduon County Assessed Value Appeal/Review Process – Todd Kaufman, Loudoun County Assessor

• There is a mandate as to how the appeal/review process works
• Loudoun County has to follow statutes and codes as to process
• There are 5 steps to the Appeal/Review process…

1. Assessment notice sent out by Loudoun County and reviewed by home owner.
2. Home owner must submit application for review (processed within assessor’s office).
3. Home owner must submit a written request for reconsideration of current assessment based on “erroneous error” (aka you can’t just say “I don’t think it’s worth what you say it is”)
4. Formal appeal to Board of Equalization (BoE)
5. If you don’t get the results you want from the Board of Equalization, you can go through the court system

• “Assessment notice goes above and beyond what the law requires”
• “Appeal process with assessor’s office is a non-adversarial process”
• BoE is court-appointed home owners living in Loudoun County. 4 members total. Burden is on home owner contesting assessment
• BoE decision is only for that year
• The Loudoun County Assessor’s Office on-line appeal application/review form is easy to complete and submit. Pre-populates the form once parcel ID is entered. You can add up to 3 attachments for supporting documents for appeal (see the bottom of this post for more on supporting documents to make your case stronger)
• To get more information about the Loudoun County assessment appeal/review process and to fill out the form on-line, click here to go to the Loudoun County Assessor’s Office web site.
  

Deadlines for Loudoun County Assessment/Assessed Value Appeals/Reviews

• March 5 – deadline for office review by Loudoun County Assessor’s Office
• June 1 – deadline to file formal appeal to BoE
• December 31 – deadline to file with court

Sample of Questions Asked By Attendees and Answered by Todd, Jennifer and/or Jim

• Question: One Ashburn Farm resident asked how her assessment  is up 21% when her neighbors’ assessments are down.
• Answer: “Could be mistake. Make sure you check the data that the county has on file.”

• Question: How do you account for unfinished/finished basements?
• Answer: “Picking up finished basements is done through the MRIS [the local MLS].”

• Question: Why is the BoE’s decision only good for one year?
• Answer: “Often times, there is a lack of supporting data from the BoE as to their decision so we put the value back at what we think it is the following year. But they’re [BoE] is getting better.”

Personal Observations and Comments

• How the Loudoun County Assessor’s Office treats bank-owned properties and short-sales is completely gray – no clear answer was given as to how nor what formula is used
• Todd said his office goes back through last year’s BoE decisions and takes those into consideration
• The Loudoun County Assessor’s Office has 4 people that do nothing else but collect data for the purpose of assessed values
• County Assessors Office “put sinformation into system to come up with value” (aka they don’t do it themselves nor is it a traditional appraisal – it’s a “mass appraisal”)
• They kept talking about how the assessments are formulated through a “system” yet, they couldn’t define what the “system” was except that it’s been in place for 30 years

Questions I had for the Loudoun County Assessor

1. How many licensed appraisers are conducting assessments and what standards are they held to (USPAP)?
2. How many homes do you actually go inside of, if any?
3. How many homes do you drive by?

I’m still waiting on answers to these questions and will keep you posted if/when I hear back.

If you have specific questions regarding your assessment, you can contact the Loudoun County Assessor’s Office by email, phone or in person….

• Email – assessor@loudoun.gov
• Phone – 703.777.0267
• Leesburg Main Office – 1 Harrison St, S.E. 5th Floor
• Ashburn Satellite Office – 45201 Research Place, Suite 130
• Loudoun County Assessor’s Office web site/home page

In order to make your case stronger when appealing your assessment, contact me to get comps (recent sales of properties that are similar to yours) to submit with your appeal application – danilo.bogdanovic@gmail.com – 703.582.6900.

How Much Will Your Real Estate Taxes Be?

A client recently asked how much their real estate taxes will be and how they are calculated. For those of you who wondering the same thing, here’s an explanation:

In Loudoun County, what each home’s actual tax amount is depends on two things…

1. the assessed value of the property as of January 1 of the current year
2. the current tax rate (currently $1.26 per $100 of assessed value)

The taxes you see listed on listings/properties for sale at this moment are typically for the current year. I say “typically” because sometimes, the tax amount listed is for the previous year.

The amount of taxes you owe changes yearly because updated assessed values come out the beginning of each year (in Loudoun County). And the tax rate can change as well. The county/local jurisdiction usually decides whether to change the tax rate after tax assessments come out. They look at their budget and see if they need to increase the tax rate in order to make up for a loss/lack of revenue thanks to overall lower assessed values (which typically happens in a down housing market where real estate values are/have declined).

In a nutshell, real estate taxes can and will change every year. What your total tax bill will be in the future is an unknown because of the process (as described above), but typically, the amount stays about the same or goes up rather than down.

Note: Every county/jurisdiction has a slightly different process – how Loudoun County does things is not the same as others.

If you have any questions, feel free to drop me a line or contact the local tax assessor’s office in your jurisdiction. Here are links to some of the assessor’s web sites throughout Northern Virginia…

• Loudoun County
• Fairfax County
• Prince William County
• Arlington County

Scott York Talks Real Estate, Tax Rate with Local Realtors

Scott York, Chairman Loudoun County Board of Supervisors met with the Dulles Area Association of Realtors Government and Political Affairs Committee yesterday. The purpose of this meeting was to discuss the Loudoun housing market and other Loudoun real estate related issues.

Some of the topics covered were:

• Current state of the housing market and future projections
• Foreclosure and short-sale situation and issues
• Loudoun down-payment assistance program and county employee housing assistance
• Best use of $2M from Neighborhood Stabilization Program (NSP)
• New Loudoun County tax rate of $1.245 per $100
• Proposed increase in proffers
• The first annual Dulles Home Fair
• Moorefield Station and Dulles Rail update

I think that we surprised Scott York with some of the latest information and statistics on the Loudoun County housing market as well as the foreclosure and short-sale situation. But that was a given… The market, bank policies and rules change so quickly and often that it’s hard to keep up – even for full time real estate agents.

Some of us made the suggestion that the county use the $2M from the Neighborhood Stabilization Program more for down-payment assistance than for buying up foreclosure properties to rehab and flip. Rather than buying 10 to 12 foreclosure properties, rehabbing them and flipping them, they could do something like offer $15K in down payment assistance to 150 home buyers who really need it. This could benefit people such as county employees many of who live in West Virginia or Maryland because they couldn’t previously afford to live in Loudoun.

Personally, I think that down payment assistance is a much better use of those funds because it’s helps a far greater number of people than flipping a few bank-owned homes. (Click here to read more about what’s going on with the Neighborhood Stabilization Program and the money)

The first annual Dulles Home Fair was also a topic of discussion, particularly the classes being offered at the event. The classes will help Realtors and consumers better understand the current real estate market and home buying opportunities. (On a side note…Loudoun County is helping sponsor the event)

The latest news on Moorefield Station is that it will be completed sometime in 2016 rather than the 2013-2015 date previously thrown around. Scott York mentioned that the bulk of the construction will occur within the last 2 years of development. Consider the next 4 to 5 years to be the calm before the storm…

And the topic that many of you have been waiting to hear about – the new Loudoun County tax rate.

When sharing our concerns with the new Loudoun tax rate and those of our clients and others we’ve spoken with, he looked as though he had heard the same things from others hundreds of times before. And then he brought up an interesting and great point…

When you do an apples-to-apples comparison of the tax rate of all the counties and areas in Northern Virginia, Loudoun County is NOT the highest in the area as many claim it is (including mass media).

Loudoun County has one real estate tax - $1.245 per $100 – that covers everything while other jurisdictions have multiple taxes that they add on top of the real estate tax. Examples of taxes that other jurisdictions add on to your tax bill are fire and rescue, stormwater service, leaf collection, refuse collection and community centers. These additional taxes make for much higher overall tax rates than advertised.

In addition, Loudoun County’s commercial tax rate is lower than many other jurisdiction’s rates. This may not mean much to many of you, but it means a lot to those of you who are involved in commercial real estate or are a business owner.

So even though Loudoun’s tax rate seemed really high at first glance,  it’s actually not as high as others in Northern Virginia (*cough*…Prince William County… *cough* …Fairfax County… *cough* …and others…)

Definitely a productive meeting with lots of good information and ideas discussed. I got some good things out of it and hope Scott York did as well.