Assessed Property Values for Real Estate in Kitsap County
We received an inquiry about assessed property values that deserves more discussion in this forum. Assessed values have risen at a double digit rate the past 4 years in Kitsap County, and now that prices are actually falling, we were asked if a homeowner needs to submit a request to the County for their assessed value to be rolled back. Our property tax system is quite complicated, and we’re not experts by any means, but we’ll try to provide a simple explanation and refer you to where you may find more details. We have discussed the information below with the Assessor’s Office.
Although assessed values have been rising at a double digit rate for the last 4 years, the actual total amount of tax collected has not been rising at the same rate. For instance, although the total value of existing properties increased 14% overall last year (which was the basis the the valuation for this year), the amount of tax collected increased by 4%. As the value increases, the tax rate decreases to compensate, so a higher valuation doesn’t automatically translate to higher taxes by the same amount. Our property values have risen faster than some other parts of the state, so for that part of the total tax that applies statewide (part of the school tax), our community has been paying an increasing portion compared to some other communities. With level or falling values the County expects that this disproportionate burden will subside.
The law limits how much any taxing district (and there are 43 districts in our County - so here’s part of the complication) can raise regular taxes (without voter approval) in any year. Basically, they are limited to a 1% increase. Voters can approve tax increases for school levies, capital projects (like a new city hall), etc. that add to this. Also new construction homes add to the total increase in taxes collected. Typical tax changes last year varied throughout the County. Significant increases in some areas were the result of voter approved measures (Fire District Levys in North Kitsap and Poulsbo, for instance).
Area Typical tax change for homeowner
Bainbridge 3.3%
Bremerton 1.4%
Port Orchard - 1.7%
Poulsbo 3.1%
South Kitsap Essentially Zero
Central Kitsap Essentially Zero
North Kitsap 8.4%
So let’s turn to current assessed valuations and whether property owners need to take some action with the County. The County has a goal to inspect and reassess each parcel every 6 years. In addition, they make an annual adjustment that is estmated based on real estate sales. There should not be much change in your property valuation for next year (based on this year’s sales), and we would expect that you might see taxes increase by several percent (by adjusting the tax rate for your property), just as occurred this year. Any levy or bond issues in your community might cause taxes to increase by more. The County doesn’t provide the nitty details of how they compute the estimated value change, so we can’t say whether your assessed value will go down even if the median sales price of property in your area declines in 2008. The County reported that this is the year in the 6 year cycle where they reassess Bainbridge Island. While the County agrees that the Bainbridge market has slowed, they did point out that more than half of the recorded sales were above current assessed values. This concept might apply in other areas as well.
There are exemptions whereby you can reduce the amount of tax you owe on your property (such as the senior exemption, which is based on both age and income level to determine eligibility). There is also a program whereby certain homeowners can defer payment of taxes. The County also has procedures for a homeowner to question their assessed valuation. The Assessor’s Office reported that they often make adjustments based on information supplied by homeowners. Our advice would be not to request a change due to the market change alone, but to submit one if you can cite significant differences between how your property is assessed and how comparable properties in your neighborhood have been assessed.
All of what we’ve presented above is from the County Assessor’s web site at http://www.kitsapgov.com/assr/levy/books.htm. Download the Assessor’s annual report for 2008. That document provides lots of details, including how to apply for exemptions, how to challenge your assessed valuation, and answers to frequently asked questions.
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