Wednesday, December 16, 2009

GA Homeowners See Relief Through ANDP's Efforts to Account for Foreclosures in Property Tax Valuation Process

We would like to recognize NHC Member Partner the Atlanta Neighborhood Development Partnership, Inc. (ANDP) as a finalist for the NHC 2009 “Pioneering Housing Strategies” Award for its work in helping to account for foreclosures in the tax valuation process.

While foreclosed properties tend to negatively impact neighborhoods by driving down home values in an area, this is rarely taken into account when it comes to assessing property taxes. Prior to the work of ANDP, tax assessors in Georgia, as a matter of standard practice, did not include foreclosed or bank-owned sales in their property tax valuation process. To help address this disparity and provide relief to tax burdened homeowners, ANDP launched a research project with Robert Charles Lesser and Company (RCLCO), a highly-esteemed national real estate advisory firm, to quantify the gap between current market values and tax assessed values in 15 of Atlanta’s metro zip codes with the highest foreclosure rates.

The campaign produced two comprehensive reports and found that homeowners in the 15 highest-foreclosure zip codes risked overpaying property taxes by $71.6 million. In downtown neighborhoods where the median sales price was $49,900, the median tax assessed value was $140,900, resulting in a potential overpayment to individual homeowners of more than $1,400 annually.

These areas had high concentrations of minority, low-income, female-headed households and unemployed residents – those who could least afford an inflated tax burden. When ANDP repeated this analysis for sales in the second half of 2008, the overpayment risk climbed 66 percent to $118 million.

The analysis caught the attention of key legislators in the Georgia General Assembly. Informed in part by the ANDP and RCLCO reports, legislators introduced a successful bill mandating that tax assessors include foreclosed and bank-owned sales in the valuation process. In May 2009, the Atlanta Journal Constitution reported that assessors lowered property tax values on 350,000 homes in Metro Atlanta’s five-core counties.

ANDP’s successful efforts represent a timely approach to helping stabilize neighborhoods affected by foreclosure. ANDP’s Susan Adams spoke about these measures in a recent installment of the Federal Reserve Bank of Atlanta's Foreclosure Response Podcast series. Today, from Noon – 2 p.m. EST Adams will be on the HousingPolicy.org Forum answering questions related to the information in the Podcast. To learn more, please participate in today’s event!

No comments: