As the South Florida real estate market continues to decline, home prices throughout the State continue to drop, and property taxes are increasing for many Florida homeowners.
If this seems counter-intuitive it's because it is. Logically, a homeowner's property tax burden should increase or decrease in direct proportion to increases and decreases in the fair market value of the home. This is especially true in Florida where property is assessed at "just," or market, value and reassessed on an annualized basis (as compared to other states where property is reassessed on a biennial or triennial basis). Still, county assessments typically trail market changes by a year or more in Florida. This is because Florida law mandates that assessments be performed a year in arrears, with January 1 designated as the statutory date for assessment.
This means that your current assessment is based on comparable sales and other market indicators for January 2- December 31 of LAST year. Thus, your 2011 property tax assessment is based on 2010 market data, and changes in the market value of your home that occur after January 1 are not reflected in your 2011 property tax bill. While this may be desirable in a rising market, it deprives homeowners of a tax benefit to which they are legally entitled in a falling market.
Moreover, although every piece of real estate is unique, county tax appraisers use a mass method of appraisal to assess home values.
Appraisers use computer models and sometimes even aerial photographs to determine square footage, the number of rooms, and other material aspects of the home. These procedures frequently fail to account for meaningful details, resulting in assessments that do not accurately reflect the home's value. In this regard, it is essential to ensure that the county has accurately valued your property. As Wall Street Journal reporters Jeannette Neumann and Saabira Chaudhuri explain in their article,this includes both (1) confirming that the property description does not incorrectly include features that increase the value of your home (e.g., extra rooms or square footage, swimming pool); and (2) assuring that the property description duly notes features that reduce the value of your home (e.g., water damage, roof that needs replacement).
To add insult to injury, local governments throughout Palm Beach, Broward, and Miami-Dade counties are on the verge of raising property taxes for 2011. Sun Sentinel reporters Brittany Wallman, Dana Williams, and Andy Reid provide a good summary of the proposed increases.
With tax increases threatened throughout the region, South Florida homeowners cannot afford to have their homes overvalued for property tax purposes. As a Florida property owner, you have the right to appeal the county's assessed value of your home. If you believe that your Notice of Proposed Property Taxes overvalues your home, you can and should appeal the assessment. But you must act quickly upon receiving your notice, as there are deadlines that must be complied with.