Falling property values not always cause for alarm
Many residents of Shelby County have heard their property values are decreasing, but property tax commissioner Don Armstrong said it’s not necessarily a cause for alarm.
“Property tax is not a simple thing to understand,” Armstrong said. “A few comments could be misleading.”
While property values in Shelby County are down approximately 1.5 percent since 2008, Armstrong explains that the value is nothing to be alarmed about because it’s a combination of many factors, including unreported home additions and buyers’ reluctance to purchase a higher-end house in the current economy.
Of the 576 neighborhoods in the county, the ones whose property values showed the largest decrease were ones with homes costing, on average, more than $200,000.
“Homes in the $100,000-$200,000 range are actually selling well, but with anything that costs more, we’ve seen a cutoff,” Armstrong said.
Pam Ausley, a Realtor in the county, said it’s still a great market for bargain-hunters because of all the recent foreclosures and bank sales, but she agrees that high-end home sales are suffering.
“The downturn in property value has made appraisals harder because it’s harder to find comparable homes, especially in the high-end market,” Ausley said.
Decreases in property values also affect what the money is spent on, such as the county’s general fund, roads, bridges, schools and more.
Armstrong said his office switched in 2004 from a four-year re-appraisal system to an annual one, which is better for programs that depend on property tax.
“With annual reappraisal we can reflect markets as they go down and up, but with a four-year reappraisal system, the taxes (level out),” said Lisa Wideman, the property tax commissioner’s chief appraiser.
Falling property values don’t always sound like disaster to Shelby County residents either.
Shelby Looney lives in Alabaster, where residential property values have decreased 2.2 percent since 2009.
“When I hear that our property values are falling, I think ‘good, I don’t have to pay as much tax on it,’” Looney said. “With the economy like it is now, we know that everyone’s property values are decreasing, and as long as it’s a result of the market and not drug dealers moving into the neighborhood, I’m fine with it.”