Metro Phoenix homeowners, your latest property valuation is in the mail.
Chances are you will be pleased to see it, though possibly a bit confused by some of the numbers.
The average increase in Valley home values during the past year is about 8 percent, according to the Maricopa County Assessor. That’s almost double 2015’s increase.
“The housing market in Maricopa County has now nearly recovered from the recession,” said Assessor Paul Petersen.
Despite last year’s increase our home valuations still seem low, but that’s on purpose.
The assessor generally values houses about 10 to 20 percent below market value to cut down on appeals and any potential to inflate values.
The full-cash value median price for Valley homes reached $197,600 in 2016, according to the assessor. The median sales price for the area last year was about $240,000.
Then there’s that other number on your home’s government assessment: the limited-cash value. It will typically be lower than full-cash value, which is a good thing since it’s the figure your property taxes are based on.
And due to Prop. 117, passed by voters in 2012, increases to your house’s limited-cash value are capped at 5 percent a year.
So your property taxes aren’t guaranteed to climb 8 percent, if your home’s value climbs that much. But your home’s taxes aren’t actually capped at 5 percent, either.
Arizona has one of the most complicated property tax systems in the country. For starters, you won’t be taxed on your home’s most current valuation for about 18 months.The lag was built in to give homeowners enough time to appeal if they thought their values were too high or low.
Petersen and others have lobbied to simplify the state’s property-tax system because now appeals can be done online and don’t take months.
But for reasons I haven’t been able to understand, those reform efforts failed.
So the bill you receive in the fall will be based on your home’s valuation from 2015.
And your property taxes could dip, inch up 2 percent or jump more than 20 percent. It all depends on where you live in metro Phoenix and how much your local school, police, firefighter or water districts decide they need to operate another year.
Those taxing districts make their decisions this summer. Unless you go to those meetings, your tax bill will be a surprise when it comes in September.
But our tax bills don’t spark a lot of outrage because property levies in Arizona are lower than at least 40 other states. Plus, most of us have mortgages so lenders pay our property taxes and then spread the bill over a year in our monthly payments.
So when you get your latest assessment in the mail, maybe the number to focus on is the full-cash value of your home. It’s likely 8 percent higher than last year. And overall, that's a good thing.