In and around Chicago, median home prices have fallen as much as 9% over the past year. But why haven't real estate taxes followed?
Unfortunately for homeowners, Assessed Property Valuations are based on the prices of similar homes that sold within the past two or three years- and some of these comparables sold when the Chicago Real Estate Market was at its peak, in 2005, and 2006.
In Cook County, the county in which the City of Chicago is located, assessed values are calculated on a tri-ennial basis. The last assessed value was determined for city residents for the 2006 Real Estate Tax Year, for taxes due last year, in 2007. These assessed values were set, last year, through the 2009 tax year, and taxes due in 2010.
Individual Real Estate Tax Bills can and do go up in between years, however, as the city's Tax Rate and Equalization Factor often changes somewhat annually. But it is when the Assessed Values increase that have the strongest potential impact on your Real Estate Tax Bill.
Northern Chicago Suburbs in Cook County were reassessed for the 2007 tax year - tax bills due this fall. Chicago Western Suburbsare in their tri-ennial reassessment period for tax year 2008, with assessed values for each property in Western Suburbs including Oak Park, River Forest, and Berwyn being made public in early 2009, with tax bills due fall of 2009.
So what can a homeowner do when he gets a notice indicating a higher proposed Assessed Valuation in Cook County? Remember, when you receive the notice, that the new assessment level is PROPOSED, not yet set - and homeowners can appeal the new assessment level. In order to appeal, you research other recently sold properties nearby, which are similar to yours, but may have been assessed at a lower value.
How to find these comparable properties? Dean's Team Chicago is one source - we can research comparable properties near your home. The Cook County Assessor Website, to be revamped within the next few weeks, also provides an easy search.
"There are certain tools out there to see whether you're on the high end of a three- or four-block radius," said Andrea Raila, a real estate tax and public policy consultant in Chicago. "Given that [Cook County] has a superior Web site, we as individual homeowners should be able to file our own [appeal].
Raila suggests identifying five or six comparable homes. If the other homes' assessed values are $5,000 or lower than the one in question, she recommends filing an appeal and beefing it up by adding data on the past few years of market prices for the neighborhood. Officials at the Cook County Assessor's Office, suggests homeowners who perceive a minimum $1,000 overstatement of value should file an appeal.
We also suggest hiring a specialized Tax Appeal Attorney to help with the process - although hiring an attorney is not required. These attorneys work on contingency - they are paid on a portion of the real estate tax savings you enjoy for their work, over the three-year assessment period. In most cases - no savings to you, no fee to your attorney.
But most experienced appeal attorneys are successful in reducing your assessed valuation, and, thereby, your real estate tax bill.
Remember, as well, that any field research the county may conduct to validate your appeal will be based on an exterior inspection only - they will not inspect the inside of your home, or any interior improvements you may have made, in order to determine whether you would qualify for a reduction in assessed valuation.
Each of our Team members file appeals on our homes during every tri-ennial re-assessment period. Our work nearly always pays off in terms of a lower assessed value, and a property tax reduction, over the ensuing three-year period.
If you need help here - please, call or email our Team!
Live or own property outside of the Chicago area? Check with your local County Assessor, Realtor, or Real Estate Attorney for information on how to appeal your Property Tax Assessment.
For more info on the Chicago and Cook County Property Tax Appeal Process, check out our post from earlier today @ BlogChicagoHomes.com. The post includes a link to Mary Ellen Podmolik's story in last Friday's Chicago Tribune Real Estate Section, "Your Place."
Hope this helps!
DEAN & DEAN'S TEAM CHICAGO