Arlington Property Values on the Rise

Columns

by Katie Pyzyk January 20, 2012 at 1:30 pm 7,490 98 Comments

For the second year in a row, Arlington’ assessed property values have gone up. Overall, 2012 real estate assessments increased by 6.6 percent.

Commercial property experienced significant growth, increasing by 13.5 percent. That puts the commercial tax base at its highest level ever, accounting for 49% of the county’s real estate tax base.

“Our commercial properties are in strong demand, particularly apartment and office buildings,” Arlington County Manager Barbara Donnellan said in a statement. “This is our second year of economic recovery — very good news for our community.”

Single family properties, including condominiums, town houses and attached homes, saw a more modest increase of 1.8 percent.

Real estate assessments will be mailed out today to all Arlington property owners. They will also be available online starting at 5:00 p.m.

The increase in property assessments will mean additional revenue for Arlington County, in the form of higher real estate tax payments, in Fiscal Year 2013. Donnellan’s proposed budget for FY 2013 will be presented next month.

Southeast Jerome

13.50% jump in commercial values must explain the expensive cupcakes.
- Andrew
  
  And crossfit gyms!
- mmmm cupcakes
  
  This is Arlington after all i.e. one of the most affluent counties in the country.
TGEoA

Dont forget, you can always see what the county board members pay for their own tax at my site

http://bit.ly/yjg6D8
- Andrew
  
  It will be interesting to see if any of the board members’ assessments increased as they were all flat (our a decrease for Fisette) last year.
  - Hattie McDaniel
    
    Mine has been flat the last three years.
- Mere citizen
  
  Thank you for this link. This is VERY interesting–that in all but one case, their property taxes have shown a pattern since 2006 of either being flat or actually declining–unlike those of just about everyone else. Very suspicious.
  
  Good work, TGEoA.
  - thecharlesriver
    
    If anyone has an direct evidence that someone on the county Board is intentionally manipulating their own property values, I say BRING IT FORWARD. Otherwise, unless you do a comprehensive assessment of all the property values across Arlington and match them against each of the Board members, this is all just a bunch of speculative bull$hit. Or if you have evidence that an assessor manipulated the value of their homes please present it. Because if you do not, you are harboring a criminal and are thus, just as guilty!
- Bluemontsince1961
  
  Thanks for this site. “Interesting” that the last couple of years or so see the Board Members’ assessments staying flat or even in one case declining. Wonder why? Hmmmm. Mine certainly hasn’t stayed flat or even declined in the past couple of years or so.
  - She does my quaalude
    
    Didn’t Fissette do some fancy gardening improvements to his house that got published in some magazine? I guess that hurt his property value for some amazing ridiculous reason on Mars.
    - John Fontain
      
      Yes, and according to county records the construction project for the in-ground pool that he put in his back yard was valued at only $14,000.
      
      For laughs, I suggest some of you call any local pool company (including NVBlu, Inc. that did this project) and ask them what you can get for $14,000. Chances are, they won’t even dig the hole for that price, let alone build the pool and all it’s associated plumbing and electrical equipment (and not to mention the stonework that was also done).
      
      Put another way, I’d bet dollars to donuts that this project cost many, many mulitples of the valuation that was reported to the county.
      
      Interesting indeed.
      - Plunkitt of Clarendon Blvd
        
        Why yes it was here is a link to the Arlnow article:
        
        http://www.arlnow.com/2011/05/06/county-board-members-yard-featured-in-southern-living/
      - Gardener
        
        What a load of crap. I’ve dug my own pools and installed waterfalls in my garden, and it cost nowhere near what you think it does. Stone is not cheap, but you can get it in bulk for less. Have you ever made water features in your garden, Mr. Fontain? Of course you haven’t. You’re just another ArlNow hater – and a frequent flyer at that. I’m so tired of people blindly assaulting County board members for nothing. If you don’t like them, fine, but try to have some facts behind your attacks.
      - John Fontain
        
        It sounds like you have misunderstood the scope of the project. It was not a koi pond or a water feature, it was an in ground pool.
        
        I have nothing against Jay and actually think he does an excellent job.
      - R. Griffon
        
        You’re talking about 2 COMPLETELY different numbers. One is what it COST to do an improvement, and the other is the resulting market VALUE. And it is almost never a 1:1 match. Some improvements have a much better return than others, and pools are one of the absolute worst. In fact in many cases they can actually DECREASE a property’s value as it detracts from useable yard (a rare commodity in these parts), and many would-be homeowners (myself included) wouldn’t want extra maintenance and increased liability.
        
        My guess is the $14K is largely due to landscaping and patio improvements that went along with the project.
      - John Fontain
        
        I’m sorry you are so misinformed about this subject. When applying for building permits, the applicant is required to provide the County with the cost of the project. The $14k is the cost listed on the permit applications and has nothing to do with the resulting market value gain or loss.
      - Hi-5
        
        @ R. Griffon nice reasonable post.
      - Duh
        
        99% of the contractors in the country low ball the permit values. It only asks for an estimate. Whoops guess they were low on that one.
  - Kirk
    
    Mine went down $10K in 2010, and another $15K in 2011.
  - It’s all relative
    
    My guess is you live in a more desirable North Arlington neighborhood like in the Yorktown district or something but that is just a guess. Regardless after a quick look at trends the board members assessment seem to mirror the neighborhood trends so you can’t hammer them for that I mean they are just 1 house of many. I’m also willing to bet that for the most part your assessment value mirrors your neighborhood trend i.e. an increasing trend unless you have done some major updating/remodeling recently.
- charlie
  
  i’d be curious about the candidates — which of their values were protected?
  - TGEoA
    
    I’m not updating it until someone gets elected, and that won’t be until after the tax rate for 2012 is set.
- Wow
  
  Good job watchdog.
Autoexec.bat

Just because the assessment went up doesn’t mean property values are on the rise.

Just sayin’.
- JohnB
  
  Actually, considering that assessments are based on sales, the assessed value does have a correlation with property values.
  - AllenB
    
    +1
  - Autoexec.bat
    
    If you believe the assessments are actually based upon sales, I suppose you might be right.
    - AllenB
      
      And what do you believe they are based on?
      - Autoexec.bat
        
        A mysterious combination of sales data and impending budgetary needs.
      - AllenB
        
        You’re half right – this is a professional process that is entirely separate from the budgeting process. If you believe that it fluctuates with budgetary needs, why would values have gone down in previous years? If you believe that is true, wouldn’t the easier thing to have done in the past years is to keep values higher than they should have been so they wouldn’t have to raise the tax rate?
      - TooEasy
        
        They exclude short sales and forclosures and any other sale below the determined “Norm”
      - Econ major
        
        @ TooEasy FYI short sales and forclosures effect “Normal” sales indirectly so they are factored in to some degree.
      - The Truth
        
        From a conversation with a county employee, the Dept. of Real Estate Assessments takes the total amount of the current County budget and uses that to set the two amounts (rate and assessed values).
        
        True story.
      - Autoexec.bat
        
        That wouldn’t surprise me one bit. Real estate assessments fund nearly half the county budget. They can’t let it get too far away from what they need it to be and when you control both variables in a two-variable equation with no one checking your work, it’s pretty easy to draw that conclusion.
      - AllenB
        
        Did that employee work in the Dept of Real Estate? If you’re answer is yes, I believe you are making the entire thing up.
      - The Truth
        
        As a matter of fact the answer to your question is YES.
      - Are you sure?
        
        @ The Truth: This sounds inaccurate given that assessments come out even before the tax rate is set. If anything wouldn’t the county board (they set the tax rate) be more likely to be adjusting the numbers based on the budget after the fact? I’m not saying this happens just questioning your logic/sources.
  - She does my quaalude
    
    Not exactly. Commercial values are set using general guidelines and practices. Residential is based more on sales because there is a much higher turnover in residential to provide the data. Also residential sales lend themselves more to an apples-to-apples extrapolation to other properties in the neighborhood or same building.
    
    Commercial values are more voodoo, residential is more algebraic.
J

And that is why Arlington County will use eminent domain to seize 2020 14th St ( 14th and Courthouse) for their own use. Nothing like kicking small business owners out to put a lower barrier shelter in a residential neighborhood at the tax payers expense.
Village Genius

“The increase in property assessments will mean additional revenue for Arlington County, in the form of higher real estate tax payments, in Fiscal Year 2013.”

That statement is correct only if the Board chooses to reap more tax dollars by setting the rate high. The Board could easily lower the rate to off-set the assessment increase, thus keeping the taxes collected steady.

Assessment x rate = tax collected

Given that the assessment is already known, adjusting/manipulating the rate will provide the taxes that the Board wants to collect.
- CW
  
  Why would a county, or a person, ever do that? Your boss gives you a raise, which means you’re worth more money (to the company). Will you increase your contributions to the federal government because you feel bad about it? Same thing with the county. Its buildings are worth more because this is a popular place to do business. Those businesses moved here knowing full well the tax rate. Unless there is an indicator showing that taxes are stifling growth in this particular region, I don’t know why the rate would be lowered.
  - Autoexec.bat
    
    ^ And this is why governments never, ever get smaller. Only pausing for breath before growing larger and larger.
    - Config.sys
      
      Well well well Mr. Bat, we meet again!
      - TGEoA
        
        God I hated config.sys and the memory barriers
    - CW
      
      Wait, so you’re saying that if an institution (company, non-profit, government) sees an increase in the value of its product (in this case, building space), that it should turn down any revenue that could be generated from it? I thought you small-government people were also free market people? The market has clearly shown the value of Arlington real estate.
      
      For the record, I never said it had to be spent on bigger government. It could be used to pay out bonds or get rid of other debt, or stored away for a rainy day. It could be used to provide other kinds of incentives to further drive growth. The critics will say “not in Arlington – they’ll spend it on a trolley”, but that’s not my point.
      - Autoexec.bat
        
        A company isn’t playing with other people’s money unless people give the company their money voluntarily.
        
        Yet returning tax revenue to Arlington taxpayers – I dare say – will NEVER be among the policy choices made by Arlington County government or any other similar jurisdiction (City of Alex, DC, etc). Why is that? It’s not their money.
      - CW
        
        You didn’t volunteer to live in Arlington? I sure did, even after figuring the costs. And I’m pretty sure that those companies that occupy all this high-tax commercial real estate volunteered to do so too, surely after very in depth financial analyses that I am certain included an assessment of the tax burden. Your argument has populist appeal (“thay took are money, rabble!!!”) but no substance.
      - Autoexec.bat
        
        So is it your contention, then, that simply by moving somewhere you agreed to pay whatever taxes you’re told you owe regardless of how those taxes are determined and spent?
        
        Is there a point at which you would feel like Arlington County has taken enough of your money and they should stop? Or are you not entitled to feel that way because you *chose* to move there?
        
        Is it the duty of every citizen to just bend over and take it, or are people allowed to question things?
      - Autoexec.bat
        
        An example from the City of Alexandria: http://alextimes.com/2011/03/your-view-when-it-comes-to-property-ass/
        
        Admittedly not Arlington County, but instructive nonetheless. If you asked Arlington County for auditable criteria upon which your assessment was based, do you think you would receive a coherent answer?
      - CW
        
        You’re saying different things now. My original contention was simple – that a jurisdiction might stand to reap the benefits of an increase in value within its boundaries by maintaining the same tax rate that it had previously.
        
        To your 3 points:
        
        1) Yes, that is exactly my contention. That is how housing markets work. Note the word “markets”. Like all other markets, they are driven by supply, demand, and prices.
        
        2) Yes, that point would come. But would it come due to the fact that my assets are ballooning in value while being taxed at a known, fixed, rate? Probably not. If I was so angry I would cash out.
        
        3) Yes, they’re allowed to. That’s why we’re having this discourse.
      - CW
        
        @ the Alexandria article – please stay on topic. This discussion was not about assessment methodology. My argument was a purely economic and theoretical one. The original article also made it clear that residential property assessnebts rose only modestly.
      - Autoexec.bat
        
        As long as you’re down with the discourse, we’re just fine.
        
        Governments cannot continue to grow in perpetuity but it seems like Arlington will at least give it a go before undergoing a major upheaval or defaulting 20 years hence. Ditto Alexandria, DC, Fairfax and so on.
      - Autoexec.bat
        
        Assessment methodology is part and parcel of this discussion and dovetails with my earlier points being discussed with Allen B. Namely, assessments are not directly reflective of rising real estate values but rather some combination of market movement plus impending budgetary needs. Therefore, the methodology by which these assessments are determined and the ability of an average citizen to not only examine them but question them is absolutely essential. Among my duties as a citizen is need to maintain a healthy skepticism as to matters of revenue generation and distribution.
      - CW
        
        I think that your last statements definitely hold truer in the residential market. As to the future – you’re right, we’ll see. If the county wanted to be conservative it could certainly get out in front of any impending slowdown by lowering rates. But as of the here and now, it’s got no data to say it should (I understand that this is how bubbles form). No easy answer. If I were in charge I’d take the revenue now but not be so eager to expand to spend it.
      - Autoexec.bat
        
        I’ll drink to that.
      - CW
        
        Cheers!
      - South Arlington
        
        Building a trolley is driving growth.
  - She does my quaalude
    
    http://www.highbeam.com/doc/1P2-1246322.html
    - CW
      
      1988 was a long time ago. When a place is in its formative years and is trying to attract business or residents, then of course lowering taxes never hurt anyone.
      
      Give me a 1988 housing price to go along with your 1988 economics lesson and we’ll be even!
      - She does my quaalude
        
        You said “ever” though. And you should note that was the fifth straight year of rate reductions.
        
        The rate has always been elastic. The county recognizes that sharply rising assessments can be a hardship on families and especially retirees on fixed incomes if the rate is not used to soften the impact.
      - CW
        
        That is fair. Though at that time I would still argue that Arlington did not have people and companies clawing all over each other to move here, thus making it a different situation.
        
        My use of “ever” was incorrect. It would lower the rate when an indicator showed that the rate was stifling growth, yes.
      - She does my quaalude
        
        A 16% increase in the housing market seems to indicate that a lot of people were trying to move to Arlington. Plenty of growth was underway by the late 80’s.
        
        Lowering the rate is more of a defensive move to keep the voters happy than it is to encourage growth.
      - CW
        
        Sure, but the area hadn’t reached the level of near-saturation that we have today. Today it’s more or less fixed supply (at least in terms of acreage; they’re still building up) but demand continues to soar.
      - She does my quaalude
        
        The economics to the SFH owner never change though, which is why we will see rate reductions in the future, even though we get closer to maximum supportable density.
        
        But to delay that, they can front-load the commercial rebound figures like they have done the past two years. If you pump those values up ahead of the curve you can get your tax money without having to raise rates on your constituents, and household incomes will eventually catch up and make the hit to homeowners easier to withstand.
        
        It’s all a numbers game. I personally think they have overcooked the commercial values given the federal downsizing that is coming. I’m not sure you can get 27% above what a building sold for two years ago in today’s market, but that’s what the past two years of increases say.
      - CW
        
        I agree with your speculation, but unfortunately it’s still just speculation. As it stands now, there have been lots of commercial buildings coming online for high market rates and more starts as well (the monstrosity on 10th that will claim poor potomac crossfit, for example). It’s tough to want to shoot yourself in the foot when everything still looks all gravy, ya know?
    - John Fontain
      
      Yeah, what a ‘cut’ that was:
      
      “Even with the rate reduction, homeowners typically will pay $160 more in real estate taxes this year.”
- Well done
  
  @ Village Genius
  What is your background? Please keep spreading your wisdom to the Village Idiots.
JimPB

RE: assessments of county board members.
A highly relevant comparison is needed. For that comparison, what about the assessments of adjacent properties?
- R. Griffon
  
  Get out of here with your reason and logic. We don’t need your kind here.
zzzzz

So I guess no one has seen the trend map yet. In general, north = up and south = down.

http://news.arlingtonva.us/pr/ava/pagedoc/2/2/7/9/5/222795/Trend_Area_Map_2012.pdf
charlie

YIPPIE — mine went down!!!
- South Arlington
  
  My Penrose home is up 2.5%
North A-Town Snob

And that 13.5% increase in apartment buildings is just going to be passed off to the rental tenants in the form of higher rents…fantastic.
TGEoA

5% up…. Now let’s see how badly they raise the rate.
PL25rd

Our tiny Cape Cod in Yorktown went up by 9.3% – and we did NOTHING to it. WTF?
- Sam
  
  Ours went up 8%, our neighbors 2%. We both have the exact same house. We did nothing to it last year; they completely gutted and remodeled their kitchen and dining room. I don’t understand this logic at all.
  - Brock Wood
    
    same here. our neighbors did a major renovation and expansion, and their house is assessed at less than ours, which is at least 1000 sf smaller and not renovated. but we are not going to contest it because it will only raise their assessment rather than lower ours.
tom smart

as a pool owner, and who recent refinanced, let me point out your flawed logic. actual costs for a swimming pool has absolutely no relation to the assessed value of a pool. why? because pools are not looked upon as an asset in Arlington like they would be in warmer climes like California, etc. in fact, homes with pools usually get closer to zero increased value in an appraisal. yes, I know, it sounds counterintuitive, but unfortunately it’s a fact.
- John Fontain
  
  I assume your post is in response to mine. To clarify again, the cost I referenced had nothing to do with value, it was the supposed cost of the project that was reported to the county. There is no way the project only cost $14,000. As I suggested, call NVBlu and ask them what kind of in ground pool they will build you for $14,000.
  
  As to your insistence that major renovations to landscaping and outside space don’t add value, please provide to me the section in the appraisal office’s guide that indicates this.
  - Really?
    
    Do you really have to report the cost of a project, such as an inground pool, to the county? We have done many things to our home, and had inspections, but never revealed the cost.
    - Lou
      
      The application for a building permit has a space where you have to fill in the estimated cost of the project.
      - dk
        
        Yes, and having just completed a county-approved renovation, I can report that the assessed value of our Cherrydale home has gone up by almost exactly that estimated cost of the project. (Prior to this project, our assessed value had been declining for a couple of years.)
tom smart

it’s not difficult for the county to raise appraised values when you are self serving
Deb

Our assessment went down…and I am not a member of the Board nor do I owe back taxes.
LyonSteve

My assessment went up almost 14%. Yet the land value didn’t change, only the improvement value. Nothing changed to my house, so it certainly doesn’t make sense to me.
- Just a thought
  
  This could be for a lot of reasons but my guess is sales in your neighborhood showed the values of homes going up, but for an increase that big given that the average increase for the county is much less the county might have updated old records to your property possibly from old outstanding permits that have not been picked up for years.
GetReal

Anyone notice that some homes that have had renovations/additions/tear downs in 2011 did not see NOT see a change in the their tax assessment for 2012.
GetReal

For example. This is a new house listed for over $2M. Tax value is <$500k. http://www.arlingtonva.us/Departments/RealEstate/reassessments/scripts/Inquiry.asp?action=view&lrsn=2797
- The taxman cometh
  
  The county just hasnt gotten around to updating their records. No way they are going to miss out on $1.5 mil tax base revenue for very long.
  - GetReal
    
    Obviously that’s the case but they are going to miss out on those tax revenues for at least 1yr, plus all the other one’s that have been missed.
    - the taxman cometh
      
      They could possibly send them a supplement tax but the county’s main focus is the masses. Better late then never.
Sal

Ours has been on a STEEP incline for the past 3 years. We went in front of the board last year and they were complete idiots. Our house is one of the smallest lots in the neighborhood, average size/condition and it is valued nearly double over much larger homes on lots 3 times the size. They told us all lots are valued the same regardless of size. Just saw ours went up another 8% this year. This is he year we get legal representation.
- CW
  
  Sorry to hear that, but you must either have a really valuable house or know a really cheap lawyer if 8% of your property tax bill is worth even a couple hours of legal fees…
  - Plunkitt of Clarendon Blvd
    
    And that is why there should be some sort of county wide home owner’s association to provide legal counter weight to the county who sends a minimum of three people to the Board of Equalization hearings.
Suburban Not Urban

I looked at my assessment and the ones for the county board members posted at the ACTA site. Does anyone actually understand why for the last 3 years the county holds land value constant but changes the improvements value? This seems counter-intuitive to me, since the cost of building a house is relatively constant usually only going up by inflation, where as the market value of fixed limited quantity like land tends to vary on supply and demand. I know its mainly book-keeping but generally the confidence in the “the model” tends to depend on sensible things like this.
Cherrydaler

Hello from Cherrydale the hottest real estate market in Arlington. The value of the improvements went up 33.7% on my tax bill in a single year (13% overall). Based on our neighborhood listserv several others had the same surprise. I’m so flabbergasted that I’m really at a loss for words.

Even were the tax rate kept the same, my bill is now 35% higher than 5 years ago. Luckily, the economic times have been so stellar that I’ve hardly noticed the increase.

Can someone wake the populace up and let them know we are getting ripped off by the free-spending county board? A $billion park here, a $billion street car there, and a chicken in every back yard. There’s your one sentence summary of the Arlington County Board.
- sue
  
  I used to live in NW and they had the ‘homestead exemption’ act which protected homeowners from dramatic increases in tax bill due to skyrocketing property values. There was a large amount you wrote off to protect homeowners.
  
  I am in Lyon Village and I have experienced an assessment that has gone up $250k in the past 3 years and we have not done a SINGLE thing to our home in that time period. Our lot is valued the exact same amount as lots 3 times the size in our neighborhood.
  
  also–half our neighborhood is tear downs or huge additions. These homes have not seen the increases that my home has seen and they have been completely renovated…or turned into a 7 bedroom brand new home. To say I am outraged is an understatement.
yorktown

some good information on here. is anyone out there intending to apeal? here in yorktown, our assessment was up 15% from previous year and running some quick calcs on comp sales within the timeframe (July 1, 2010 – June 30, 2011), I’m not seeing evidence of a 15% increase. taking average rate/psf on finished area for comparabely sized homes, lots, newer construction, I’m arriving at a 2% increase. we and several of our neighbors will be appealing.

Subscribe to our mailing list