Montclair NJ hired Realty Appraisal Company to conduct a town wide voluntary tax reassessment, which will be used for your 2012 assessment and taxes. Why? The last revaluation was done in 2006, at the height of the market. Since then, property values have declined, somewhere between 17%-19%, and the town has been faced with thousands of tax appeals – over 1,100 in 2011, resulting in millions of dollars in tax refunds, and costing the town big bucks to handle the appeal process. The goal of the reassessment is to bring all homes to market value, in order to distribute the tax burden fairly. The 2011 reassessment is based on inspection data collected in 2006 for the revaluation completed by Appraisal Systems, Inc. In the 2011 reassessment, physical inspections are being limited to homes with open permits and certificates of occupancy, although some drive-by exterior inspections are being done. The appraised values placed on property are as of October 1, 2011. These values are being determined by recent sales data, as well as active & under contract properties; permit information and tax settlement information are also incorporated in the analysis. It’s important to note that your market value is neighborhood specific–in other words, your home is compared with other homes in your neighborhood. Realty Appraisal is using the neighborhood definitions delineated by Appaisal Systems, Inc..I believe there were more than 50 defined neighborhoods in Montclair.
- All properties in town are being reassessed, even those who appealed their taxes and won a settlement
- All homeowners should have received their new assessment as of this post (1/13/2011)
- Realty Appraisal is holding informal meetings with people who want to discuss their new assessment. Meetings will continue through January 21st, although it is possible that the meetings will be extended into the following week
- Realty Appraisal must finalize all assessments by February 1, 2012
- A second letter will be mailed to homeowners who met with Realty Appraisal, with the final assessment
- Assessments will be posted on the Realty Appraisal website once they are finalized and homeowners notified
What does all this mean? Since the total assessments are going to lower, the tax rate will increase. We will not know the final tax rate until the 3rd quarter, which is the way it always is. The tax rate is a simple calculation—total town budget (made up of the county contribution, municipal budget & local school budget) divided by the total assessments. However, once the assessments are finalized, the town should have a good estimate of what the tax rate will be based on the 2011 budget and an estimate of the 2012 budget. The estimated rate I have heard circulating is somewhere between 3.0 and 3.1. Say the rate is 3.1, a home with an assessment of 500,000 will pay taxes of $15,500 in 2012.
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