Property tax bills climb as values dip
Facing tough economy, homeowners feel pinch
By Matt Carroll
Globe Staff / August 17, 2008
The average assessed value for single-family homes in Massachusetts fell for the first time in more than a decade last year, even as property tax bills continued to climb.
Interactive graphic Values and tax of single-family homes in Massachusetts, 2008
The average single-family home was valued at $403,695, a slight dip from $406,673 in 2007, according to data from the state Department of Revenue for the fiscal year that ended June 30. It was the first drop since 1994. More than 140 communities lost value last year, with the biggest drop recorded in Peabody, at nearly 10 percent.
But property taxes continued to rise statewide. The average single-family bill increased $149 to $4,111, up 3.7 percent from a year ago, according to Department of Revenue data analyzed by the Globe. Taxes jumped more than 5 percent in 30 communities.
"Values go down and tax rates go up and everyone pays a little more and they aren't happy," said James C. Judge, the assistant assessor in Kingston, where the average bill jumped 9.8 percent, following a tax override, and assessed values dropped nearly 5 percent.
The combined drop in assessed values and continued tax increases is a double dose of bad news for homeowners at a time when they are already reeling from higher energy costs that could impose substantial hardships this winter.
In previous years, homeowners facing tax hikes could console themselves with the knowledge that their home's value had increased. Statewide property values had double-digit percent gains each year between 2001 and 2005, according to the state.
But that's not the case this year, and it could get worse because of the sagging real estate market.
Assessed values that communities use to calculate property taxes actually lag behind the market. The assessed values for fiscal 2008 are based on what a home was worth on Jan. 1, 2007, according to assessors.
In the first half of 2008, home sales in Massachusetts were down 19.1 percent and prices fell 9.2 percent compared with the first half of 2007, according to the Warren Group, which tracks real estate sales.
"When values have gone down, people have to understand there is a lag time and it doesn't reflect market value," said Richard Gorden, a member of the Sharon Board of Assessors and also a real estate agent with Re/Max Landmark. "There's no way around that."
Real estate woes aside, 11 communities had homes with average assessed values of more than $1 million, led by Chilmark, at $1.7 million - which was down a fraction from last year. Four of the towns are on Martha's Vineyard.
One of those communities, Aquinnah, actually saw the largest percent gain in value, nearly 30 percent, to $1.3 million, although assistant assessor Angela Cywinski said the gains should more properly be spread over the past three years. The small town of 432 homes last year had a 1,500-square-foot waterfront property on six acres sell for $3.5 million.
Higher taxes, meantime, are never popular, regardless of valuation, and property owners in Massachusetts are increasingly weary of the steady increase.
Interactive graphic Values and tax of single-family homes in Massachusetts, 2008
The statewide average dollar amount increase for the year ending June 30 was the smallest since 2001. Increases have ranged from about $160 to more than $200 since 2001.
For the past year, Weston homeowners paid the highest average tax bills in the state, a staggering $14,537. Six other communities, all but one in the suburbs west of Boston, had bills averaging more than $10,000.
In Boston, assessments for owner-occupied single family homes dropped by about $10,000, to $409,478, and taxes fell by about $140, to $2,949, according to the city. Taxes rose slightly in Brookline, and fell in Cambridge, according to the state data.
Elsewhere around the state, many towns with big jumps in average tax bills have passed property tax overrides recently. In Wenham, which approved an override last year, the average tax bill climbed more than 10 percent. Residents can take solace from the fact that property values rose slightly, to nearly an average of $640,000.
"The hurting is not as bad as in other communities," said Steve Gasperoni, principal assessor in Wenham.
Westwood, where taxes increased more than 10 percent, also passed an override in 2007, and its effect on taxes apparently caught some folks by surprise, judging from their comments, said Debbie Robbins, town assessor.
"An average house in this town is probably [assessed] at slightly over $500,000, so you're talking about a $550 increase in taxes," said Robbins. "I don't know about you, but I think that's a lot to swallow."
Home prices appear to have stabilized in at least some communities, according to some observers, but where prices are headed is open to debate.
Prices appear to have stopped falling in Boston, although they are still dropping in communities hit hard by foreclosures, such as Brockton and Lawrence, said Karl E. Case, a cofounder of the S&P Case Shiller National Home Price Index, which tracks housing prices across the country.
Still, it's hard for homeowners to mentally adjust to falling assessments and rising taxes, after more than a decade of solid gains in values.
"Psychologically, it bothers people," said Case, who is also a professor of economics at Wellesley College. "In an absolute sense it feels worse because houses went down in value."
The situation makes it all that more difficult for financially beleaguered towns to persuade homeowners to raise taxes through overrides or other measures, said Michael J. Widmer, the president of the Massachusetts Taxpayers Foundation. "The combination of declining property value and increasing property tax creates anxiety for people," he said.
Voters are increasingly reluctant to support tax overrides. Less than half of overrides passed over the last three years. Between 2000 and 2005, however, more than half passed.
Matt Carroll can be reached
Facing tough economy, homeowners feel pinch
By Matt Carroll
Globe Staff / August 17, 2008
The average assessed value for single-family homes in Massachusetts fell for the first time in more than a decade last year, even as property tax bills continued to climb.
Interactive graphic Values and tax of single-family homes in Massachusetts, 2008
The average single-family home was valued at $403,695, a slight dip from $406,673 in 2007, according to data from the state Department of Revenue for the fiscal year that ended June 30. It was the first drop since 1994. More than 140 communities lost value last year, with the biggest drop recorded in Peabody, at nearly 10 percent.
But property taxes continued to rise statewide. The average single-family bill increased $149 to $4,111, up 3.7 percent from a year ago, according to Department of Revenue data analyzed by the Globe. Taxes jumped more than 5 percent in 30 communities.
"Values go down and tax rates go up and everyone pays a little more and they aren't happy," said James C. Judge, the assistant assessor in Kingston, where the average bill jumped 9.8 percent, following a tax override, and assessed values dropped nearly 5 percent.
The combined drop in assessed values and continued tax increases is a double dose of bad news for homeowners at a time when they are already reeling from higher energy costs that could impose substantial hardships this winter.
In previous years, homeowners facing tax hikes could console themselves with the knowledge that their home's value had increased. Statewide property values had double-digit percent gains each year between 2001 and 2005, according to the state.
But that's not the case this year, and it could get worse because of the sagging real estate market.
Assessed values that communities use to calculate property taxes actually lag behind the market. The assessed values for fiscal 2008 are based on what a home was worth on Jan. 1, 2007, according to assessors.
In the first half of 2008, home sales in Massachusetts were down 19.1 percent and prices fell 9.2 percent compared with the first half of 2007, according to the Warren Group, which tracks real estate sales.
"When values have gone down, people have to understand there is a lag time and it doesn't reflect market value," said Richard Gorden, a member of the Sharon Board of Assessors and also a real estate agent with Re/Max Landmark. "There's no way around that."
Real estate woes aside, 11 communities had homes with average assessed values of more than $1 million, led by Chilmark, at $1.7 million - which was down a fraction from last year. Four of the towns are on Martha's Vineyard.
One of those communities, Aquinnah, actually saw the largest percent gain in value, nearly 30 percent, to $1.3 million, although assistant assessor Angela Cywinski said the gains should more properly be spread over the past three years. The small town of 432 homes last year had a 1,500-square-foot waterfront property on six acres sell for $3.5 million.
Higher taxes, meantime, are never popular, regardless of valuation, and property owners in Massachusetts are increasingly weary of the steady increase.
Interactive graphic Values and tax of single-family homes in Massachusetts, 2008
The statewide average dollar amount increase for the year ending June 30 was the smallest since 2001. Increases have ranged from about $160 to more than $200 since 2001.
For the past year, Weston homeowners paid the highest average tax bills in the state, a staggering $14,537. Six other communities, all but one in the suburbs west of Boston, had bills averaging more than $10,000.
In Boston, assessments for owner-occupied single family homes dropped by about $10,000, to $409,478, and taxes fell by about $140, to $2,949, according to the city. Taxes rose slightly in Brookline, and fell in Cambridge, according to the state data.
Elsewhere around the state, many towns with big jumps in average tax bills have passed property tax overrides recently. In Wenham, which approved an override last year, the average tax bill climbed more than 10 percent. Residents can take solace from the fact that property values rose slightly, to nearly an average of $640,000.
"The hurting is not as bad as in other communities," said Steve Gasperoni, principal assessor in Wenham.
Westwood, where taxes increased more than 10 percent, also passed an override in 2007, and its effect on taxes apparently caught some folks by surprise, judging from their comments, said Debbie Robbins, town assessor.
"An average house in this town is probably [assessed] at slightly over $500,000, so you're talking about a $550 increase in taxes," said Robbins. "I don't know about you, but I think that's a lot to swallow."
Home prices appear to have stabilized in at least some communities, according to some observers, but where prices are headed is open to debate.
Prices appear to have stopped falling in Boston, although they are still dropping in communities hit hard by foreclosures, such as Brockton and Lawrence, said Karl E. Case, a cofounder of the S&P Case Shiller National Home Price Index, which tracks housing prices across the country.
Still, it's hard for homeowners to mentally adjust to falling assessments and rising taxes, after more than a decade of solid gains in values.
"Psychologically, it bothers people," said Case, who is also a professor of economics at Wellesley College. "In an absolute sense it feels worse because houses went down in value."
The situation makes it all that more difficult for financially beleaguered towns to persuade homeowners to raise taxes through overrides or other measures, said Michael J. Widmer, the president of the Massachusetts Taxpayers Foundation. "The combination of declining property value and increasing property tax creates anxiety for people," he said.
Voters are increasingly reluctant to support tax overrides. Less than half of overrides passed over the last three years. Between 2000 and 2005, however, more than half passed.
Matt Carroll can be reached
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