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Market reality hits home; TRIM notices show most Cape Coral

By Staff | Aug 30, 2008

By Valarie Harring, “mailto:vharring@breezenewspapers.com”>vharring@breezenewspapers.com

If new construction and sales that entailed the removal of a Save Our Homes cap are excluded, approximately 90 percent of Cape Coral properties saw a decrease in taxable values this year.

The largest portion fell 50 to 75 percent, according to information provided by Lee County Property Appraiser Ken Wilkinson Friday.

“Most went down,” Wilkinson said. “Most that went up are a little misleading.

According to Wilkinson’s office:

n 2,235 parcels in Cape Coral saw a decrease in taxable value of 75 to 100 percent.

n 52,341 parcels saw a decline in taxable value of between 50 and 75 percent

n 33,075 parcels saw a decline in taxable value of between 25 and 50 percent

n 32,439 parcels saw a decline in taxable value of between 1 and 25 percent

All told, approximately 120,000 parcels in Cape Coral saw a decline in taxable value, Wilkinson said.

Taxable valuations include various exemptions, including the additional Homestead approved by voters earlier this year. Taxable value, depending on the number and types of exemptions allowed, could actually be zero for some low-end, owner-occupied properties, hence declines as high as 100 percent in some rare instances.

In addition:

n 844 parcels showed no change in taxable valuation

n 994 parcels showed an increase in taxable valuation of 1-25 percent

n 317 showed an increase of taxable value of 25 to 50 percent

n 207 showed an increase of taxable value of 50 to 75 percent

n 631 parcels showed an increase in taxable value of more than 75 percent

Most of the parcels that showed an increase in taxable valuation were either new construction — a home or building constructed on a lot or undeveloped parcel — and new construction such as the addition of a second story or new garage; or a sale that removed the Save Our Homes benefits enjoyed by the previous owner.

If you took out those two reasons, probably 90 percent of the properties went down in taxable value in the Cape,” Wilkinson said.

Next year, deeper declines are expected, he added.

This year, the rolls were boosted by more than $4.1 billion in new construction countywide. New construction this year — and it is this year’s sales and new construction numbers that drive next year’s taxable valuations — won’t hit that level. Meanwhile, market values have continued to drop and the number of short sales have increased, Wilkinson said. Short sales are the fallout from foreclosures, which do not play into the numbers upon which valuations are calculated as a foreclosure does not involve a willing seller and a willing buyer. A short sale, a sale that occurs after a bank or other lender forecloses and then sells the property for less than what is owed, involves both.

The office has been getting some inquiries but not as many as they would have been expected had the “
TRIM,” or Truth in Millage notices that went out last week not had new and additional explanatory information, he said.

This year’s preliminary tax notices — TRIM notices are not bills — explain the application of the additional Homestead exemption implemented after voters approved Amendment 1, the school tax portion of the bill, which is unaffected by Amendment 1 along with an explanation of how taxable value is calculated.

Still, the office is getting calls from property owners who want to know why their taxable value has not declined as much as they had expected due to current market prices in their neighborhoods.

Wilkinson explained that, as per the state constitution, taxable values are calculated on fair market value as of Jan. 1, in this case Jan. 1, 2008. For practical purposes, this means last year’s sales, so values, either going up or coming down, are always a year behind.

Also as per state law, property owners can question, or challenge their valuations. The deadline this year is Sept. 16.

Wilkinson said his office welcomes calls and has upgraded its phone system to better accommodate those who seek information on valuations. If property owners are questioning tax rates or the estimated tax bill itself, though, the appraiser’s office is not the place to raise those issues, he added.

If you have a problem with taxes, you really need to go to the budget hearings, that’s where you can lower your taxes,” he said.

Tax rates are set by taxing authorities, including the city of Cape Coral, Lee County and the school district.

That’s why it’s called Truth in Millage,” Wilkinson said of the tax notices that tell property owners the tax rates under consideration by the various local governing boards, with computations as to what those rates might mean when the bills do go out.

While lower valuations mean lower taxes for many, depressed market values have hurt the economy.

Wilkinson does recognize this.

We need to get this inventory moving to get the market back,” Wilkinson said. “Real estate remains in the doldrums.

The property appraiser’s office is in the process of adding a new service to its Web site, www.leepa.org, Wilkinson said.

His office is preparing to list all foreclosures countywide, with addresses and STRAP numbers but not property owners’ names. Instead, the site will list the source of the foreclosure, a bank or mortgage company so interested parties can follow up.

I think that’s a public service,” Wilkinson said. “If we have the information, we need to get it out there.”