Colorado homeowners, no longer protected by the Gallagher Amendment, face unprecedented and unsettling increases in their property taxes next year as the run-up in home prices during the pandemic works its way into the state’s tax base.
“We know we will have this issue, but it is like a train wreck about to happen where you have no brakes and you can’t do anything to stop it,” said Glen Weinberg, owner of Fairview Commercial Lending in Evergreen and Steamboat Springs, who has blogged about the slow-motion crisis.
County assessors in late April will mail out valuation notices based on property values as of June 30, 2022, which also happens to be close to when home values peaked in Colorado. Although not one-for-one, looking at how much home values rose in Colorado over the two years prior to the date offers a rough proxy for potential property tax increases in 2023 and 2024.
Using the median sales price numbers from the Colorado Association of Realtors, homes prices are up 55.9% in Boulder, 45.1% in Denver, 43.65% in Adams, 41.2% in Jefferson, and 36.6% in Arapahoe and Douglas counties. In seven counties, the median price of a home sold has more than doubled over the two-year valuation cycle — Bent, Castilla, Otero, Pitkin, Routt, San Juan, San Miguel and Otero.
Homes sales prices help determine home values, but they can be skewed by the mix of homes selling in a given period. Assessors obtain a value for every property, and although different in its approach, Zillow also tries to do the same with its Home Price Index. The values there are then aggregated up to the county level. While not as extreme as the gain in the sales numbers, they are big too.
Over the two-year valuation period, Zillow has home values up 31% in Boulder, 29% in Adams and Broomfield; 27% in Arapahoe, Denver and Jefferson counties. And those are restrained compared to other parts of the state, especially the resort areas. Zillow has Bent County home prices doubling in the two-year period, while home values in San Miguel, Pitkin, Eagle and Routt counties are up 75% or more over the two-year period.
“What we are looking at now is a statewide average increase of about 36% on valuation. The property tax will track with that in great part,” estimates Mike Kopp, CEO of Colorado Concern, an alliance of CEOs and …read more
Source:: The Denver Post – News