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The skyrocketing home values in many parts of Summit County has been a boon for those looking to sell, with homeowners sometimes reaping hundreds of thousands of dollars in equity over the course of a year or two.
But for those who are not looking to move, the sudden uptick in their home’s value can mean they need to come up with thousands of dollars on short notice to pay increased property taxes.
Summit County Assessor Stephanie Poll said some areas, like the Silver Creek neighborhood, had homes double in assessed value between 2020 and 2021.
She said one person whose Silver Creek home value nearly doubled when it was reassessed visited her office to see if there was something he could do to reduce the newly increased property taxes. He was facing an unexpected $1,800 bill and the prospect of paying double the property taxes in 2022 and going forward.
“It can be quite devastating for those on a fixed income,” Poll said. “It is heartbreaking, actually.”
Residents can appeal their home’s valuation through the Board of Equalization. The deadline is 5 p.m. Wednesday. Poll said she has seen fewer appeals this year than other years, though her office has fielded more phone calls about the issue.
“At the end of the day, it’s the market value. ‘Can I sell my house for that value?’” she said. “What they’re finding is, they can.”
She said the Assessor’s Office does a detailed review of properties every five years, meaning the increases in market rates are sometimes not immediately reflected in assessed home values. She said state law requires the Assessor’s Office to value homes within 95% of their market value.
“In reality, those hit hardest right now were low to begin with,” she said. “That’s the hardest part — if you were below market value, and some significantly low, and then we address it with market value changes, it’s nearly doubled them.”
In addition to Silver Creek, she said areas in the Snyderville Basin and South Summit also saw large increases. Some homes within the Park City boundaries saw a 50% to 60% increase in value, she said.
Mark Jacobson, the president of the Park City Board of Realtors, said the assessed values reflect the real estate market.
“We have had pretty substantial gains in sales both in price and number of homes sold,” he said. “We are seeing so many higher priced homes sold, and more quickly, than ever before.”
Poll said the aggregated value of homes in Summit County jumped from $17.2 billion in 2020 to $20.1 billion in 2021. Those numbers include about 369 more homes in 2021.
“Our market in the past couple years is just hopping crazy,” she said. “I’ve been doing this for 20-plus years. In a healthy market, a home sells in six to nine months. We have things that almost don’t get listed, there are bidding wars on it. In 30 days, a house is sold. We’re talking a crazy hot market.”
The surge in home values does not mean that tax revenues will increase for local governments and taxing entities. Utah law requires taxing entities to receive the same amount of tax revenue each year — plus the proceeds of new growth — unless they raise taxes by going through a process called Truth in Taxation, which requires a public hearing.
Summit County Auditor Michael Howard sets the tax rates for the dozens of taxing areas around the county.
He said tax rates go down as home values go up to hold the revenues collected across a taxing jurisdiction steady.
To offset the Silver Creek resident’s $1,800 increase, for instance, taxing jurisdictions collected $1,800 fewer dollars elsewhere, but that doesn’t make the tax increase in Silver Creek and elsewhere easier to handle.
“I know Silver Creek has seen a huge increase. They haven’t been valued in several years,” he said. “All of a sudden when the valuation clock ticks for them, the consequence is taxes go up, too.”
Poll said the resident whose home value doubled was on a fixed income that was too high to qualify for a tax abatement, and he was left scrambling to find the additional money by the end of the year.
“Something needs to be done for our senior citizens on a fixed income,” Poll said.
She indicated state legislation could address the issue, though an attempt to do so last year failed. Poll indicated that piece of legislation did not sufficiently restrict who could avoid paying taxes.
She said her office was conducting periodic audits on secondary homes, estimating that 60% of the homes in Summit County are not primary residences, though the official number is 54%. Primary residents pay property taxes on 55% of their property’s taxable value, while secondary residents pay taxes on 100% of it.
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September 15, 2021 at 07:01PM
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Skyrocketing home values in Summit County mean higher property taxes for some - The Park Record
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