In 2025, most people in Cumberland County are expected to see a significant jump in their residential and commercial property taxes, and possibly their property tax bills.
That’s because the county plans to update the assessments for property in the county and set new, updated tax amounts. State law requires tax assessments to be done every eight years to ensure they are up to date. The last reassessment was in 2017.
Cumberland County Tax Administrator Joseph Utley presented commissioners Monday with a draft 362-page manual called “Schedule, Standards and Rules” that the county tax administration would use in determining the new values.
“The county appraiser’s job is to arrive at a reasonable estimate of market value,” the manual says.
The county commission has scheduled a public hearing to solicit public comment on the reassessment process and the manual’s formula. Scheduled for Oct. 21 at 6:45 p.m. in Room 118 of the E. Maurice Braswell Judge Court.
Devalued in 2017
In a 2017 reappraisal, residential property values fell 4.9%, while commercial properties rose about 4%, the Fayetteville Observer reported at the time.
Fayetteville real estate agent Wendy Harris told CityView on Thursday that home values have declined as homes for sale flooded the local housing market after the Great Recession.
Now, the housing market has recovered and the situation is reversed. Home values have increased dramatically because too few homes are being built to meet demand, she said.
Fayetteville City Councilman Deno Hondros, a real estate agent, told Cityview that city officials expect real estate within the city limits to increase by 15% to 42%, with most being somewhere in between. He said he expected that.
At first glance, this could increase people’s property tax bills. However, city, county, and town governments can set the tax rate at a “revenue-neutral” level after the reassessment is complete. It depends on what they decide, Christopher B. McLaughlin, a professor at the University of North Carolina School of Government, said in a blog post about property tax reassessments.
How to calculate the value
The county’s Schedules, Standards and Regulations Real Estate Valuation Manual states that when setting the value of residential real estate, such as single-family homes, appraisers rely heavily on market data and sales prices for comparable properties. There is.
Valuing commercial real estate is more difficult because commercial real estate is bought and sold much less frequently than residential properties, the manual states.
Therefore, in the case of commercial real estate, appraisers can use two additional methods of setting value when assessing the value of commercial property, other than market value based on recent sales in the area .
First, consider the price of the land and the replacement cost of the building minus the depreciation of the building. This is used for industrial properties with few changes in ownership. The formula then takes into account the market value of the property and the income it generates. It is often used in commercial housing such as apartments. Cumberland County Commissioner Jimmy Keefe. Credit: Cumberland County
Commissioner Jimmy Keefe said at Monday’s meeting that apartments and other multifamily properties should be evaluated using an income-based valuation formula, as is done for shopping centers, rather than a mark-to-market valuation based on recent sales, as is the case for single-family homes. I had doubts about doing so. -parents’ home.
He said apartment complexes house many families and each family requires government services funded by tax dollars, but shopping centers require relatively few services.
Keefe asked county staff to study how each valuation method (recent market value of comparable properties and the income the property generates) affects tax assessments.
County Manager Clarence Greer said officials will recover data and costs for serving families in multifamily housing.
Utley said state law does not allow counties to assess the added value of properties based specifically on the cost of providing services to residents.
Senior reporter Paul Woolverton can be reached at 910-261-4710 and pwoolverton@cityviewnc.com.
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