Spotlight
Shopping Center Wins Tax Appeal
A developer for a local shopping center successfully lowered its assessed value, resulting in a substantially decreased property tax bill. Eastman & Smith attorney Linde Hurst Webb represented the developer.
Ms. Webb’s real estate practice incorporates appraisals, real estate valuation challenges, access issues, tax appeals, zoning and eminent domain. She has a vast knowledge of appraisal and real estate valuation techniques, and shares some relevant factors to consider when deciding whether to pursue an assessment appeal.
When Appealing an Assessment May Make Sense.
While paying less taxes may be a dream of many, there are some indicators that could determine the success of an assessment:
- Current market value has decreased.
- Similar local properties have lower assessments.
- For facilities that are rented, such as office buildings and shopping centers, they have high vacancy rates.
- A reassessment results in a higher than expected tax liability, especially for new projects.
- Property conditions have deteriorated or property has incurred significant damage.
- There is an inadvertent mistake in the assessment resulting in a higher value appraisal.
When Waiting to Challenge an Assessment May be Prudent.
Sometimes waiting rather than acting may be in your best interest. Such situations may include:
- A recent purchase price that is above the current tax value, without a good explanation for the higher price (like a seller financed purchase).
- A lack of strong valuation evidence.
- A recent request for reassessment.
- The property’s assessment is due to be updated by the auditor.
- You plan to sell the property soon. In such instances a lower assessment may affect what potential buyers are willing to pay.
Sometimes the smartest move is to prepare now and act at the right time.
Key Takeaways
If you are deciding whether to ask for an informal property reassessment or file a valuation complaint, a first step would be to compare the property’s current value to similar local properties. Next would be to determine when the next reassessment is scheduled. Lastly, decide if the efforts to reassess the property are worth the potential savings, including the cost of an expert appraiser.
Should you have questions regarding a reassessment of your property, please contact Ms. Webb.
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Disclaimer: This alert has been prepared by Eastman & Smith Ltd. for informational purposes only and should not be considered legal advice. This information is not intended to create, and receipt of it does not constitute, an attorney/client relationship.
