Appeal real estate tax assessment after home purchase (Arlington, Fairfax: real estate market, assessor)

[khyung]

I just purchased a home for a price much lower than the tax assessed value because the home requires considerable repair. What is the best strategy to lower the tax assessed value?

The Fairfax County real estate appeal form allows the homeowner to appeal each year's tax assessment. According to the seemingly obsolete form for 2010, I need to wait until the 2011 year's assessment and appeal before April 2011. Because I purchased in December 2010, seemingly too late for the April 2010 deadline, I would like to file a special appeal.

1) Does the huge discrepancy between purchase price and tax assessment entitle me to an immediate appeal, instead of the usual annual appeal cycle?

2) I shall commence repairs on the house soon and want the home appraiser to see the home before my repairs. Should I take photographs before my repairs, in case the appraisal process has considerable lag? Do I need to hold off on extensive repairs until the appraisal process formally begins?

3) By January 2011, there will automatically be new tax assessment for the new year. Should I wait for the new tax assessment before appealing? Does appealing after the new tax assessment give me more leverage than appealing before the new year? By waiting until after the 2011 tax assessment, would I be able to benefit from the overall market decline as well as my home's specific condition?

4) Basically I think that I need to balance two competing forces in choosing an appeal date. On one hand, I want the appraiser to see the home condition as soon as possible before my repairs. On the other hand, I want to wait until the new 2011 tax assessment, to benefit from both overall market decline and the home's poor condition. What would be safest strategy to lower the tax assessment?

[khuntrevor]

Appeal immediately after you receive your 2011 assessment. You only are paying for 1 month or so taxes for 2010, so it wouldn't be much anyway. I wouldn't try to be sneaky about repairs. If you are doing work that doesn't require permits; just let the sleeping dog lay. Just the simple fact that you paid a lot less than they say it is worth is your best ammo. Look at the comps, also. I just paid 40% below 2011 assessment in Phoenix (our 2011 came out in January of 2010). My ink pen is ready for the 2012. They may choose to drive by your home, and if you read the Assessor's website, they may indicate that all properties are periodically visited.

[khyung]

Consider 5014 Mendell St 22030, which has been declared uninhabitable by Fairfax Health because its septic system failed and cannot be restored to modern code without extensive renovation. Amazingly its tax assessment fell the price from $600K to $100K in 2009.

5) I assume that the unbelievable price drop from 2008 to 2009 can be attributed to the property's uninhabitability. Likely Fairfax Health deemed the septic failure a show-stopper and lowered the property's assessment. Are there public records to explain the extreme drop shown below?

6) What are typical strategies for lowering tax assessment? Asking Fairfax Health to declare septic failure appears quite drastic for Mendell. Are there other examples of steep drop in tax assessment?


MAP #: 0672 01 0009
KHAMBAY PHOUANGBOUPHA 5014 MENDELL ST
Values
Current Land $315,000
Current Building $8,550
Current Assessed Total $323,550
Tax Exempt NO
Note

Values History
Tax Year Land Building Assessed Total Tax Exempt
2010 $315,000 $8,550 $323,550 NO
2009 $90,000 $9,000 $99,000 NO
2008 $425,000 $176,400 $601,400 NO
2007 $326,000 $196,000 $522,000 NO
2006 $326,000 $143,430 $469,430 NO
2005 $220,000 $87,420 $307,420 NO
2004 $130,000 $87,415 $217,415 NO
2003 $97,000 $97,415 $194,415 NO
2002 $64,000 $125,415 $189,415 NO
2001 $50,000 $106,540 $156,540 NO
2000 $50,000 $86,120 $136,120 NO

[NovaNida]

I would go ahead and appeal immediately. As a Realtor in Northern Virginia, I know that the Northern Virginia Real Estate Market is actually slowly rebounding and would advise not to put too much faith in appraisals(which is just an opinion and can sometimes vary greatly unfortunately). Also, some other things to consider would be cost of labor. Without knowing your exact property and what projects you are intending to do, I can't extrapolate how much you might save with an appeal but during winter months labor is a lot cheaper so starting sooner rather than later could be a good idea as well!

Best of luck!!

[ACWhite]

I had a somewhat similar situation in Arlington, where assessors refuse to consider the condition of the property, even when you appeal (I ended up having to appeal it to the board, most of whose members were amazingly ignorant of the law that requires properties to be assessed at current FMV, which I didn't expect and was not well enough prepared to address). I would strongly urge you to take the photographs, as you plan to do. The county assessor who visited my home after more than $30K of repairs had been made counted all of them as if they were made BEFORE I bought the house, and virtually held her fingers in her ears and said "la la la, I can't HEAR you" when I tried to explain that those repairs had been made nearly a year after the END of the assessment period for the current tax, and by law should NOT have been taken into account.

In other words, my advice would be to be polite, but do not expect assessors or citizen members of any appeals board to be well-informed of the law or committed to fairness--go online and make sure you understand exactly what the law says, then construct as well-documented a case as you can, and appeal it as high as you need to. If you think going this far would not be worth the tax savings $, then you may not want to start the process, because it will take a lot of your time and could be aggravating and ultimately result in little adjustment. My reasoning is that, if Fairfax does take condition into account (which I believe that they do, per their property search function on their website that provides a rating of the condition (e.g., "average", "good", "handyman")), then because the condition will have improved for the next year's tax period, then the tax savings, if you succeed, would really only be for one year.