Questions and Answers

Questions and Answers:

Q:  Why are we reassessing?

A:  New York State Real Property Tax Law REQUIRES us to keep property values at an even level to ensure all properties are assessed uniformly and the tax burden is divvied up equally to all citizens in our municipality. As property values change relative to one another (specific neighborhoods, styles, etc. may increase or decrease at different rates from year to year) reassessments are necessary to keep values fair. Assessing at 100% of market value is the most common and easily understood method to achieve this.

Q:  What is an equalization rate, and how does that affect the taxpayer?

A:  If the town is not assessed at 100% full market value, the State assigns an Equalization Rate. Simply put, an equalization rate is the average ratio of what properties are selling for versus what the assessments are and applied to each property. Equalization rates are used when apportioning full market value with taxing jurisdictions that have authority over two or more assessment districts (County and school districts) so that all bear the same relationship to total market value when determining tax rates. Equalization rates may cause higher tax rates as well as a decrease in exemption value (such as Veterans exemption, STAR, etc.) This is why, on your tax bills, the assessed value (what your tax rates are applied to) and full market value (the estimated value after the equalization rate is applied) may differ.
    Equalization rate formula-sample
Q:  How often does the town conduct a reassessment and when was the last update?

 A:  In recent years the town has conducted assessment updates/reassessments every four years. The last update was done in 2018 (it will be six years in 2024).

Due to significant market changes between 2018 and 2022, it was decided to hold off on the update temporarily to see what the market was going to do. The update was postponed for 2023 for the same reason. The real estate market has seen greater and more sustained growth than at any other time in recent history. Since our last update the median home price in Ogden has gone from approximately $155,000 in 2018 to nearly $226,000 in 2022 per data collected from the Multiple Listing Service, and it is continuing to climb as seen in the partial year of 2023 in the chart.

 Links:

          2018-2023 Median Sales (MLS data) graph

          2018-2023 Median Sales (MLS data) data

 Q:  How is the new value of my property determined?

A:  Property values are driven by the real estate market and are based on current sales of similar type properties. Factors considered are size (square foot living area), location (neighborhood), lot size/acreage, condition, construction grade, age, number of bedrooms and bathrooms and additional features such as basement type, garages, fireplaces, inground pools, porches, etc. The value is generated using a computer valuation model reviewed by real property appraisers for reasonableness. Sales typically used are within a one- to three-year period.

Q:  Do taxing jurisdiction get more revenue when a reassessment is done?

A:  Taxing jurisdictions (towns, counties, villages, schools) do not get any more in taxes by raising an assessment, nor do they get any less by lowering one. The amount of money that the taxing jurisdictions collect is determined at budget time and that amount, the Tax Levy, is completely irrespective of the assessments. What assessments do decide is how much each property must pay towards that levy. If your assessment goes up by a larger percentage than the average increase, you will pay a larger share. If your assessment goes up by a smaller percentage than the average increase or decreases, you will pay a smaller share. Either way, the total taxes collected will be the same.

Q:  What are the key dates associated with assessment valuation?

A:  New York State Real Property Tax Law has two important dates for valuation:

March 1st of the current year is the taxable status date. Properties are assessed based on their conditions on that date; any changes after that do not affect assessments until the following year.

July 1st of the previous year is known as the Valuation Date or the target sales date. Comparable sales should be as close to that date as possible. (We generally consider 2 or 3 years of data for a larger pool of comparable sales).

Q:  What happens if the market declines?

A:  For future years if there is a continual decline in property values: assessments may be lowered to reflect the market values. You should keep in mind that the lowering of assessments (across the board) may slightly increase the tax rates, this is dependent on budgets and the tax levy. We monitor market trends annually and make adjustments to the assessments if and when appropriate. The real estate market sales drives the values; it is taken into account what properties are selling for versus what their assessments are. Again, the taxing jurisdictions do not get more revenue for increased assessments or less revenue for decreased assessments; the revenue raised from taxes is directly tied to set budgets.

Q:  What happens to exemptions after a reassessment?

A:  Your previous exemption status does not change because of a reassessment. After the reassessment equity project, when the goal of 100% equalization rate has been attained, all exemptions that are affected by an equalization rate are adjusted to the 100% value of the exemption.

Q:  Will my taxes go up after a reassessment?

A:  Not everyone’s taxes increase after a reassessment. Tax rates are determined by dividing the budgets into the total town taxable value. Therefore, the tax rates should be reduced when the total town taxable increases. Some property owners could see an increase in their taxes and some may see a decrease in their tax liability. See example below:

 

  THE SMITHS THE JONES TOTAL TAXES COLLECTED
Assessment PRIOR to reassessment $100,000 $100,000 $4,000
Taxes PRIOR to reassessment $2,000 $2,000 ($4,000 levy divided by $200,000 total assessed values x 1,000 = tax rate $20.00 per 1000 AV)
Assessment following reassessment $300,000 $150,000 $4,000
Taxes following reassessment $2,667 $1,333 ($4,000 levy divided by $450,000 total assessed values x 1,000 = tax rate $8.89 per 1000 AV)
Amount of changes: +$667 (increase of tax burden) -$667 (decrease of tax burden)