Here’s What You Need to Know About Appealing the Jeffco Assessor’s Valuation of Your Home

This column was published in the Denver edition of YourHub from the perspective of Jefferson County property owners.  See other blog posting for same article from the perspective of Denver property owners.

By the time this column appears in print, all Colorado homeowners will have received in the mail a letter from their County Assessor declaring the “Actual Value” of their real estate holdings in that county. I own both a commercial property (Golden Real Estate’s office) and my personal residence, so I will be receiving two such letters. 

The letters give taxpayers until June 1st to file an appeal of that valuation which, if successful, could lower the “Assessed Value” (explained below) against which taxes will be levied for 2017 and 2018.

Property taxes in Colorado are paid in arrears, which means that the property tax for 2017 isn’t payable until April 2018, and the property taxes for 2018 will be payable in 2019. The valuation you just received in the mail, however, is not a statement of your home’s current value.  Rather, it is a statement of your home’s market (or “Actual”) value as of June 30, 2016, based on its condition on January 1, 2017.

 

In other words, if your house was significantly improved between last June 30th and January 1st, the assigned value should be what your home in its new condition would have been able to sell for on June 30, 2016, based on what comparable homes did sell for prior to that date. (You may need to read these two paragraphs a few times!)

 

The good news is that even though your home’s value has continued to increase since last June and will continue to rise for the next year or two, you will only pay property taxes for both 2017 and 2018 based on what it might have sold for in June 2016.

 

Nevertheless, many of us (me included) are going to be shocked at how much the assessor claims our homes have increased in value.

 

Additional good news for homeowners is that, because of both TABOR and the Gallagher Amendment — too complicated for me to explain here — the percentage of “Actual Value” against which your local mill levy will be applied, has reduced by almost 10% — from 7.96% of actual value to 7.2%.  That creates the “Assessed Value.”

 

To keep it simple, here’s an example using round numbers. If the assessor says the market value of your home for the last two years has been $500,000, your “Assessed Value” was 7.96% of that, which equaled $39,800.  If your mill levy is 100, then your tax bill was $3,980 (100 x 39.8).  Let’s say your home’s “Actual Value” as of last June 30 rose to $600,000, a 20% increase. Your “Assessed Value” will be 7.2% of that, or only $43,200. Thus, your tax bill, at 100 mills, will be $4,320, an 8.5% increase in taxes despite a 20% increase in market value.  By the way, this is the first reduction in the assessment percentage since 2003.  Great timing!

 

And it gets even better. Unless the voters in a particular tax district voted to “de-Bruce” the mill levy, that tax district must lower its mill levy as much as necessary to keep its revenue from increasing beyond TABOR limits based on population growth plus any increase in the cost of living. For example, the City of Lakewood has lowered its mill levy a couple times since 2011 to comply with  TABOR limits. That’s not the case, however, with our biggest mill levy, Jeffco Schools, which “de-Bruced.”

 

Nevertheless, since your property taxes are the sum of multiple mill levies from various districts, that hypothetical rate of 100 mills that I used above might actually be lower this year, further reducing your property tax bill.

 

To guide Jeffco homeowners through the appeal process, I created a website which you may find helpful. It’s at www.HowToAppealValuations.info. Meanwhile, let me give you some key advice.

 

1) You can only appeal the assessor’s valuation by citing comparable sales during the 24 months prior to June 30, 2016. Unless your home was mischaracterized (wrong neighborhood, style, etc.), all eligible comps are listed under “Neighborhood Sales” on the assessor’s web page for your home, so don’t bother looking elsewhere.

 

2) You must “age” every comp you cite in your appeal by about 1% per month, since Jeffco properties increased by an average 22.8% over that 24-month period.  Thus, if a comp sold in Jan. 2016 for $500,000, you can’t cite it as a comp at the price, but must increase that price by 6% to its theoretical value as of June 30, 2016.

 

To find your home on the assessor’s website, visit http://assessor.jeffco.us and click on “Property Records Search.”

 

As I write this, I haven’t seen the letter myself. Last cycle, the Jeffco Assessor stopped saying which comps they used to calculate each home’s value.  That’s unfortunately. By comparison, Denver’s assessor gives at least 3 comps and shows on their website how each one was used to establish value, much like in a formal appraisal.

Denver Has 10 of the Nation’s 50 Most Competitive Real Estate Neighborhoods

According to data from Redfin, as published last week by the Denver Business Journal, the Denver metro area has 10 of the 50 most competitive neighborhoods in the country.  Four of them are in Aurora, four of them are in Jefferson County, and two of them are in the City and  County of Denver.

Competitiveness was determined by looking at a combination of factors including the percentage of homes that sold above asking price, were on the market under a week, and that sold for cash and above asking price.

Nationally, only Seattle and Boston had more competitive neighborhoods.

The top ranked Denver neighborhood is College View, coming in at #13 nationally. The median sales price in this neighborhood was $230,000, reflecting an average price growth of 31.4% over the previous year. The ratio of sales price to listing price was 100.7%, with 56.6% of listings selling above asking price. The median days on market was 5, and 41.7% of sales were cash.

The other Denver neighborhood in the top 50 was Mar Lee, which ranked #40 nationally, with a median sales price of $260,000. The average increase in sold prices over 2015 was 15.6%.  Average sale-to-listing price ratio was 101.8%, with 53.2% of homes selling above the listing price.  Median days on market was 6, and 27.2% of sales were cash.

If median prices seem low in some of the most competitive neighborhoods, it’s because of the high number of condos and townhomes vs. single family homes there. The greatest increases in sales prices due to competitive bidding is in the lower price ranges populated primarily by condos and townhomes.

These neighborhoods may have ranked higher than the City and County as a whole, but Denver did pretty well itself and would probably rank pretty highly nationwide if the data were compiled by county instead of neighborhood.

In the City and County of Denver as a whole, the median days on market was 8 and the average home sold for 100% of listing price.  The median sales price was $365,000, which was 9.0% above 2015. Citywide, 24.6% of the listings sold for cash.

In Jefferson County, the median days on market was 7 and the average home sold for 100.4% of listing price. The median sales price was $360,844, which was 12.8% above 2015. Countywide, 15% of the listings sold for cash. 

Highest rated in Jefferson County was the Lakeside neighborhood, ranked #8 nationally, where the median sale price was $370,000, an increase of 27.6% over 2015. 58.4% of listings sold above their listing price. The average home sold for 102.1% of the asking price. Median days on market was 6, and 32.3% of homes sold for cash.

Next highest, rated at #12 nationally, was the West Pleasantview neighborhood, just east of the City of Golden, where the median sales price was $350,000, 20.1% higher than in 2015. 47.8% of homes sold above their asking price, with an average differential of 102.3%.  Median days on market was 6, and 38.5% of the homes sold for cash.

The next Jeffco neighborhood in the top 50 nationwide was the Union Square section of Lakewood, rated #23 nationally.  There the median sales price was only $194,500, but that was 18.8% higher than in 2015.  52.5% of listings sold above their asking price, with an average differential of 101.2%.  The median days on market was 4, and 32% of homes sold for cash.

The last Jeffco neighborhood to rank in the top 50 nationally was Bear Creek, at #42, with a median sale price of $225,000, up 17.4% from 2015. 64.7% of homes in this neighborhood sold above listing price, with the average differential being 102.4%. Median days on market was 4, and 18.8% were cash sales.

In Aurora, the median days on market was 6, and the average home sold for 100.8% of listing price.  The median sales price was $275,000, which was 12.2% above 2015. Citywide, 14% of Aurora listings sold for cash.

The four Aurora neighborhoods which ranked among the 50 most competitive nationally, according to Redfin, were Hoffman Town (#14), Highline Villages (#17), Horseshoe Park (#27), and Northwest Aurora (#38).

Published Jan. 5, 2016, in the YourHub section of the Denver Post and in four Jefferson County weekly newspapers.

Following Backlash, Jeffco Commissioners Drop Plan to Legislate Beltway

[Published April 26, 2012 in the Denver Post]

Last week I described the effort by Jefferson County’s Board of Commissioners to introduce legislation which would create an authority with “super eminent domain” powers to complete the beltway from northeast of Highway 36 though Jeffco and Golden to connect with C-470.

This Monday, that effort was killed by the Commissioners themselves, following quite a backlash from the public and from legislators who considered the proposal a massive overreach and an unwarranted gutting of long established local powers.

Commissioner Don Rosier told me at press-time (Tuesday) that the Governor and CDOT requested that they drop the proposal and return to the negotiating table.

Prior to this short-lived effort, the Commissioners had essentially given up on forcing a beltway though Golden and had created a public highway authority to secure private investors for a toll-road north of Golden connecting Highway 93 and Highway 128 but leaving gaps south through Golden and between Highway 128 and the beltway’s current end east of the Boulder Turnpike. (Nevertheless, the Commissioners and the highway authority continue to promote their toll road as “completing the beltway,” and the press has generally picked up on that inaccurate and lame phraseology.)

The proposed legislation was perceived by toll road critics (including myself) as a desperate last ditch effort to get the beltway completed, since negotiation with Golden to drop its opposition to the toll road had backfired and even led to Golden filing suit against the use of contaminated Rocky Flats land for part of the right-of-way.

An equally questionable strategy (already in place) for establishing the “privately funded” toll road has been the use of Jeffco Open Space funds (from sales tax revenue) to facilitate purchase of the 300-foot right-of-way though Rocky Flats. Here’s how it was explained to me Tuesday by Assistant County Administrator Kate Newman:

The County gave $1.225 million in general funds to the toll road authority, which put those funds into escrow to buy the 300-foot right-of-way. Meanwhile, the County put $5.1 million of Open Space funds into escrow as its contribution to the purchase of another parcel (Section 16) to be deeded over to US Fish & Wildlife, but that fully-funded transaction only closes when and if the authority closes on the right-of-way purchase. I wouldn’t be surprised if this comingling of purposes were to trigger another lawsuit, this time over the misuse of Open Space funds.

Jeffco Planning Commission Promotes Blight

[Published with my column in the Denver Post, on Jan. 12, 2012]

What is “smart growth”?

In November, the Jeffco Planning Commission approved a revision to the North Plains Area Plan, designating over 1,000 acres of open land west of Highway 93 as a new “Urban Activity Center.”  Although this didn’t constitute a rezoning of what is currently agricultural land, it means that a future request for urban-style rezoning would be justified as complying with the revised plan for that area.

I testified against the redesignation, and pointed out that promoting that kind of sprawl — the kind which has transformed the areas through which C-470 and E-470 pass — actually promotes blight in the older developed areas.

Creating more and more suburban opportunities for overbuilding merely promotes sprawl, but it also promotes continued abandonment of older areas.  A “smart growth” strategy, in my opinion, would only open outer agricultural areas to development as a shortage of developable land is perceived in the inner urban areas.

By contract, the building of transit lines, such as TREX and FasTracks, promotes smart growth. I recently learned, for example, that there has been $6 billion of economic development along the TREX corridor since that transit line opened.