Local real estate assessments have gone up — again.
Both the City of Charlottesville and Albemarle County posted double-digit increases in real estate assessments for 2023. The county mailed its notices to property owners earlier this month; the city’s go out this week.
In Charlottesville, overall assessed property values rose by 12.33% for 2023. That’s on top of a roughly 11% increase from 2021 to 2022, meaning that in just two years, the assessed value of city real estate has increased by nearly 25%.
Albemarle County saw a roughly 20% increase in property value in that same time frame — 13% in 2023 and 8% in 2022.
“These two reassessment cycles have been larger than any I’ve seen since I’ve been with the city,” said City Assessor Jeffrey Davis, who was appointed to the post in 2015.
The reason assessments are so high is properties are selling for much higher prices than they were a few years ago. This is not unique to Charlottesville. Nationally, home prices surged some 37% during the pandemic, according to a story from CBS News.
Assessed property values are not the same as a home’s market value (assessments are often much lower). But the market value impacts the assessments. Assessors offices look at the local real estate market — residential, commercial, and new builds — when conducting assessments.
“It’s been the second year of pretty large increases, but that’s what we saw in the sales this year,” Davis said. “This has certainly been a seller’s market.”
When assessed property values go up, so do real estate taxes.
Localities calculate property taxes by multiplying a property’s assessed value by the local tax rate. Higher assessments mean higher tax bills, “unless the tax rate is adjusted to offset some of that,” said Davis.
More about the local housing market
Last year, Charlottesville’s budget projected it would collect about $89.5 million in real estate taxes. Albemarle County projected collecting about $197.7 million.
For 2022, Charlottesville City Council raised the real estate tax rate by 1 cent per $100 of assessed value, to $0.96 per $100 of value. Council reasoned that it would help fund projects it had already committed to.
“It’s much too early to say” what the city will do with the additional tax revenue it stands to receive, said Mayor Lloyd Snook. “We will need to see what the City Manager presents to us as a budget.”
Council expects to see the City Manager’s draft budget in late February. It could choose to adopt a new rate in June.
Albemarle County’s real estate tax rate is slightly lower than the city’s, $0.854 per $100 of assessed value. It has not gone up since 2019, when the Board of Supervisors increased it from $0.839. The real estate tax rate will be part of the county’s budget process, and the Board of Supervisors could opt to change that rate in May.
And it’s not just Charlottesville and Albemarle County, said Davis. He’s hearing similar things from assessors in Hanover, Henrico, and the City of Staunton. And local news outlets from across the nation are reporting similar stories this year.
City and county property owners can appeal their assessments. The deadline for city residents to do so is 5 p.m. on March 1, said Davis — that has been extended from the previously published deadline of Feb. 28. The county deadline is Feb. 28 at 5 p.m.
In previous years, both the city and the county also have offered real estate tax relief for homeowners who are over age 65, under a certain income threshold, or have certain disabilities. The city’s application period opens Feb. 1 and closes at 5 p.m. March 1. In the County, repeat applicants must submit their applications by April 1; new applicants have until Oct. 31.