Saturday, December 15, 2012

The Property Tax Shuffle

Every few years, the county government reappraises the values of property in the county to determine tax values.  The latest reappraisal was fairly important since the last county auditor was convicted for taking bribes.

Though the old auditor is now in the slammer, there's still reason to be concerned though.  The county's formula for estimating property values appears to stem from a broken Mickey Mouse calculator, or whatever algorithm came up first in a Google search.  Though the latest appraisal did reflect the general drop in property values since the Great Recession hit, it still is quite inflated.  I'll use my street as an example.  During the past year, 8 homes sold, all more or less similar, for an average price of $88,396.  Yet, according to the county's appraisal method, which apparently consisted of driving down each street and making some numbers up, the house worth the least on the street is worth $105,700.  The county should clue in the folks trying to sell their houses now, all of which are priced less than $100,000 and still not selling.  Why are the buyers not recognizing such bargains and jumping on them, huh, Cuyahoga County appraisers?

Of course, the county has little incentive to provide accurate property values, since they would get less tax money.  The kneejerk tendency is to inflate values.  In Ohio, the situation gets complicated a bit by a law that keeps tax revenue at a certain level regardless of property value, but still to some extent lower values equal lower taxes.

People can challenge their inflated house values, but it doesn't appear many people do so, which explains how the county can get away with it.  Why people want to just give away more money to the notoriously corrupt county government is beyond me (though much of the money will go to schools, libraries, and local municipalities).  I suppose one can't complain about property taxes too much (at least one is fortunate enough to own property), but the property should be accurately valued.

Homes are oddities anyway.  Nearly everything else one owns gets sold for less when it's used, but people always think homes should sell for more (the old "God isn't making any more land" argument only goes so far to explain it).  Unfortunately, making housing more expensive means people have to work harder just to live.

The same goes for property taxes.    

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