The Double Whammy of Foreclosures And Assessments

Posted in Foreclosed House, October 14th, 2008 |

The tax assessments on properties are unusually high in the localities that have been badly hit by foreclosures. For residents it is a double whammy coming from foreclosures and assessments according to the findings of an advocacy group from Atlanta.

The survey included in its study the metro regions of five counties and concluded that those with the highest rates of foreclosures were also paying the highest property taxes. Atlanta Neighborhood Development Partnership working for affordable housing noted that the taxes were based on falsely hiked valuation. This is putting a heavy load on communities struggling with foreclosures. Rehabilitation is becoming impossible under the circumstances.

John O’Callaghan CEO of this group said, “This is about fairness in who pays those taxes. There’s a disconnect between the tax-assessed value and what we know these homes re selling for. That creates a disconnect.” Living in a poor neighbourhood has come to mean payment of more property taxes. This is unfair.

In 15 zip codes that recorded the most number of foreclosures the average value of a house was $26,000 more than the average sale price of the unit. The survey complained that if tax assessors did not adjust the figures then the zip code residents would have to pay $71 million as ‘excess property taxes’ in the forthcoming year.

Most of these foreclosure-hit zones are criminal dens dotted with derelict houses. It is impossible to count in dollars what it is costing the community. A higher task bill will only worsen matters.

The survey group hauled up the authorities for overtaxing the poor and being slow in revising property values to realistic levels. The counties are being called upon to review the situation. Clayton County officials responded positively but complained that the study is not fully accurate in its details about the foreclosure situation. Rodney McDaniel, Chief Appraiser of Clayton County said that already a positive and proactive approach has been taken to reassess the valuation of the houses of those areas that are badly hit by foreclosures. He said, “Just this year, we took it upon ourselves to look at those foreclosures. We reduced our property assessment notices for 27,000 parcels. So we are actively looking at the housing market, the economic situation, very closely. We are continuing to look at it very closely. If there are adjustments that need to be made in 2009, we will continue to work on that.”