Reassessment far too high for 1 in 12 Richland homes

Reassessment bills under scrutiny

About one in 12 properties in Richland County was appraised at far more than its value during this year’s reassessment, according to the state Department of Revenue.

Another 15.8 percent of property owners got assessments that were right at the market value or just over, a Revenue Department study found.

State officials say it is not unusual that some homes — like the one in 12 appraised at 110 percent or more of its market value — are overvalued. Those homeowners probably have grounds for a successful appeal, they acknowledge.

But that this year’s assessments came so close to market value — and, in some cases, exceeded it — has been a big shock to many homeowners.

A home’s assessed value is important because counties use home values to set taxes every fall. And, in almost every case, a higher assessment means a homeowner will pay higher taxes.

Carrie Porter was stunned her family’s home in the Heathwood neighborhood was appraised by the county at $640,700.

“If we were going to try to sell it for that, we would probably need to do a lot of work,” she said.

One reason for the shock is some people think the county’s appraised values are supposed to come in at 20 percent or so lower than their homes’ actual market value.

The belief is so widely held that some property owners use it when buying their homes.

“It’s just a whole lot more than what they appraised it for the last time,” said Kathryn Luchok of her Hollywood-Rose Hill home. She said she had heard when she bought her home that the assessment would be about 80 percent of its fair market value.

Reassessment relies on computer models to appraise properties. That is because it is not feasible for a county to inspect each home and business property — about 150,000 in Richland County, state officials said.

But that is also why some estimates come in lower — and some higher.

Robert Gantt, appraisal coordinator for the Department of Revenue, called Richland County’s range of values “very acceptable.”

Gantt reviewed Richland County’s reassessment before the county mailed notices in February to 108,000 property owners whose property values increased by more than $1,000.

He concluded that, for 67 percent of Richland properties, the county’s appraisal was between 80 percent and 99.99 percent of the fair market value.

“You are going to have some disparity on the low end and on the high end,” Gantt said. “The people on the high end are probably going to go appeal their assessments.”

Many property owners have criticized the county’s reassessment, saying the value of their homes could not have increased so dramatically in the past five years. They fear the new assessments will mean large increases in their tax bills this fall.

And some of them are armed with recent private appraisals because they took advantage of low interest rates to refinance.

So far, 2,800 property owners have appealed, saying the county overvalued their homes. The appeals deadline is May 3.

In 1998, 6,345 people appealed their assessments, according to the assessor’s office. More than 11,000 appealed in 1992.

URBAN MYTH

Luchok is trying to decide whether to appeal the county’s appraised value for her three-bedroom home. The appraised value is less than what she paid for the house four years ago, but she still thinks the 40.5 percent increase in the past five years is too high.

“I think they probably underestimated it back then,” she said.

She had expected that the county would appraise her home at less than its market value.

But Richland County assessor John Cloyd said a homeowner has no complaint if the home is assessed at a figure that is below or equal to market value.

Assessors across the state say many property owners incorrectly assume the county’s appraised value will be less than the fair market value.

“It’s an urban myth,” said Rick Dolan, Lexington County’s assessor.

Kathy Williams, assistant director of the S.C. Association of Counties, said property owners simply are used to seeing appraised values lower than the market value. Until 1995, when the Legislature required reassessments every five years, counties didn’t regularly re-examine property values. That meant that the county’s appraised value often lagged behind the market value.

“I think people are just used to seeing that, but that’s not how it should be,” she said.

Rudi Laub, of Huiet Appraisal Co., said he often has encountered clients who think their assessment will be less than full value. Eighty percent seems to be the most common assumption, he said.

“You just can’t go by that,” he said. “It’s not going to be significantly less. What’s realistic is for it to be 95 to 100 percent.”

Cloyd said he always tries to appraise property as close to fair market value as possible.

“Every time you do a reassessment, you take it up to market value,” he said. “But then over a five-year period, it works its way down to 85 percent. That’s why you do reassessment — to adjust that.”

The state study shows most Richland County properties were appraised at between 87.5 and 99.5 percent of fair market value.

BIG DISCREPANCY?

Carrie Porter and her husband, Fred, think their home is among the properties that have been appraised at more than what they could sell it for.

The couple paid about $250,000 for their five-bedroom home in Heathwood when they bought it from Fred’s mother in 2001. While they acknowledge they got a good deal, they question the county’s conclusion: an increase of $355,700 — from $285,000 in 1999 to $640,700.

Porter is appealing, saying the assessor’s office may have overestimated the value of the house by comparing it with other, more upscale homes in Heathwood. She said the basement is not finished, the bathrooms haven’t been updated and the house doesn’t have a lot of the upgrades, like granite kitchen countertops, that neighboring homes have.

“It’s a big house, but it’s basic,” she said.

Told of Porter’s case, Cloyd said he agreed her situation warranted further review.

It’s not unusual for there to be some mistakes, especially in larger counties, Gantt said.

“There are instances where, in doing 150,000 parcels of property, where something might be missed or something might be calculated wrong,” he said. “If there is an error that has been made, there’s an appeals process for that.”

Newton Hornsby already has appealed the $465,000 value the county placed on his Wheeler Hill home. He met with a county appraiser last week, armed with the sales prices of several neighboring homes, which were between $295,000 and $315,000.

“I just think some areas got blasted, and the fact that they weren’t done individually by on-site appraisers, it left them open to error,” he said. “If you don’t request an appeal, then your property is never looked at.”

Hornsby is waiting to hear whether his appeal is successful.

“I’m feeling good today,” he said last week after the meeting. “I might not be feeling good tomorrow.”

Staff writer John O’Connor contributed to this report. Reach Hill at (803) 771-8462 or sehill@thestate.com