(Updated at 5:15 p.m.) Property values in Arlington County rose at a slower rate this year compared to last year, according to the latest tax assessments, and slower than projected by staff.
The value of all residential and commercial property rose by 1.9 percent over the past year, compared to 3 percent the previous year. Homes went up in value by 3.9 percent, compared to a rise of 2.5 percent last year.
It means the average home value in Arlington, including condominiums, townhouses and detached homes, is now $640,900, up from $617,200 last year.
“Year after year, we see through our rising residential property values that Arlington is a place people want to live,” said County Manager Mark Schwartz. “At the same time, we’ll have some challenging budget decisions in the months ahead, given that our overall property values did not grow as much as projected.”
While residential real estate continued to rise, the value of office buildings was down significantly.
“Office properties, which represent 17.6 percent of the County’s total property tax base, saw significant declines — down 6.9 percent since last year,” the county said in a press release. “This decrease was driven primarily by office vacancies as well as rent concessions.”
The slower growth overall will mean a budget shortfall for Fiscal Year 2019, with debate on county spending levels to continue this year. Staff initially projected a 3.2 percent increase in the value of all real estate, so with actual growth of 1.9 percent the county will need to find savings to balance the budget.
Schwartz and Arlington Public Schools Superintendent Patrick Murphy will present their respective budget proposal late next month.
The full county press release is after the jump.
Arlington County property values grew at an overall slower rate in 2018 compared to the previous year, as the County completed its annual assessment process. Declines in office property values were the main driver of the slowdown.
Overall, the combined value of all residential and commercial property rose by 1.9 percent over the past year, compared to 3.0 percent the previous year.
Residential properties recorded a solid 3.9 percent increase, up from 2.5 percent last year. The value of the average Arlington home, including condominiums, townhouses and detached homes, is now $640,900, up from $617,200 last year.
“Year after year, we see through our rising residential property values that Arlington is a place people want to live,” said County Manager Mark Schwartz. “At the same time, we’ll have some challenging budget decisions in the months ahead, given that our overall property values did not grow as much as projected.”
Most commercial property values rose in 2018, too, with hotels, retail and apartments all posting gains. Existing apartment values increased 4.1 percent, reflecting increasing rents, while general commercial increased 2.7 percent and hotels increased 1.0 percent.
Office properties, which represent 17.6 percent of the County’s total property tax base, saw significant declines–down 6.9 percent since last year. This decrease was driven primarily by office vacancies as well as rent concessions.
Real estate assessments will be mailed on Saturday, Jan. 20, to all Arlington property owners. Calendar year (CY) 2018 assessment information will be available online Friday, Jan. 19, at 11 p.m. The CY 2018 assessment is an estimate of the fair market value as of Jan. 1, 2018. Look up your 2018 property assessment.
Slower growth in assessments will impact County budget
Arlington, like all local governments in Virginia, relies heavily on revenue generated from real estate property taxes to fund vital services for residents, visitors, businesses and workers.
This past fall, County officials projected a 3.2 percent increase in the value of all residential and commercial real estate–and a comparable increase in tax revenues. With actual growth of 1.9 percent, the County will face a greater shortfall as it works to develop a balanced budget for the upcoming 2019 fiscal year, which begins July 1.
Expenditures are rising at a greater rate than revenue, due to normal inflationary cost increases and other pressures, including rising costs for social services for residents, significant increases in enrollment in Arlington Public Schools, and increasing debt service costs.
The County and Schools will work with the community to determine how best to balance these and other competing demands, including making strategic investments to enhance the County’s economic competitiveness and minimizing the burden on County taxpayers.
The County Manager and Arlington Public Schools Superintendent will present their budgets to the County Board and School Board in late February.
For more information on the budget process, visit the County Budget webpage.
About real estate assessments
Real estate assessments are not appraisals. They are the County’s opinions of value for each parcel of real property in Arlington. The assessments are made using accepted methods, standards and techniques of the real estate appraisal and assessment profession. For more information, visit the County webpages on real estate assessments.