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County assessor reports land values holding steady, foreclosures down |
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By Tom Dybing
Houston County Assessor
Property tax statements and equalization notices should be in your possession or coming soon to your mailbox. You are receiving the end product and the beginning product of the property tax cycle. Your final tax notice for payable 2008 is the end product for the assessment year 2007. The equalization notice for 2008 is the beginning of what will generate your taxes for payable 2009.
Prior to our valuation notices going out, the Houston County Assessor’s Office has received questions about property values going down. This concern and perception has been generated from the media reporting about the sub-prime issue, the economy, fraud, foreclosures, short sales, and our August flood, which are reducing the value of property. Those reports are real in the regions they are spawning from. But, our response is that we haven’t seen it in our area yet.
In talking to Houston County Recorder Bev Bauer, she searched her record system for 2007 and found 10 recorded foreclosures. This number is actually down from 2006. Up to this time our area seems to have been insulated from most of these maladies due to stable employment. We did experience one disaster in the flood of August 18, which did impact our area. For those property owners who personally experienced the August flood, we have reduced your taxable value for payable 2008 by the amount the disaster reduced your property value and in accordance with legislation statutes. This year’s market and future markets will ultimately tell us the value of directly affected properties and unaffected properties with the same characteristics.
Property valuations
What did happen to property values this year in Houston County? For agricultural properties our office made two changes in value. We increased our 100 CER value from $3,200 to $3,600/acre. Our average CER for all agricultural properties is 70 CER. This generates an average value in Houston County of $2,520/acre.
For those enrolled in the “Green Acres” program the value of woods and waste increased from $600 to $750/acre. This value was generated from a Department of Revenue study. The “Green Acres” values, specific to each county in Minnesota, were generated from this study. The balance of the farm property values for sites, house and garage, out-buildings, woods, and waste remain the same as last year. The increase in the 100 CER value is a reflection of farm sales throughout Houston County and all agricultural areas in the Midwest.
The valuation market is being driven by the commodity markets reaching all time highs for all commodities. Prices for corn over $5 per bushel and beans over $12 are generating competition for tillable land. This competition for land results in higher land rents and sales generating new highs per acre when a parcel of land comes up for sale. Seasonal recreational properties have the same value as the prior year. The frequency of sales for Seasonal Recreational Residential properties has slowed down from what we have experienced the last few years.
Overall, residential and commercial properties changed very little in Houston County. The residential jurisdictions that saw small increases were La Crescent city, Hokah city, and Houston city. The one commercial change in estimated market value, occurred in Houston city, based on a five year history of sales.
Any change in estimated market value given by our office to similar properties in a jurisdiction is called local effort. Local effort, which can be an increase, decrease, or no change for properties, is reviewed by the state board in June. If the Department of Revenue determines inappropriate changes have been made according to the sales studies, a state board order will be given to correct the valuations in that jurisdiction.
New home construction
One set of data the County Assessor’s Office has been keeping since 2000 is the number of permits for new homes and their value. This data had a surprising result. One intuitively, would think fewer homes were built in 2007 than the prior year. The assessor’s office had permits for new home starts in 2007 of 61 compared to the year 2006 number of 50.
This difference is an increase of 11 new homes from the previous year. The average estimated market value of the 2007 homes determined by the assessor’s office use for tax purposes is $237,100. This value includes the structure and land value. Every year since 2000, more homes are built in the townships than within city limits. In 2007 the highest concentration of new homes occurred around the Caledonia area.
Tax Statements
The property tax statement this spring for those in the Caledonia and Houston school districts will generate more taxes because of the voter approved school referendums than what appeared on the Truth in Taxation notices. The Truth in Taxation notices are the proposed taxes you received in November and the calculation of the taxes were calculated prior to the local elections.
Limited Market Value has been keeping taxable market values down where properties have been experiencing high increases in value from one year to the next. This method of valuation will terminate in the 2009 assessment year, payable 2010.
If a property owner has any questions concerning the value or classification of your property, please call (507) 725-5801 or stop by the assessor’s office in the Houston County Courthouse in Caledonia.
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