CGA Law News & Blog

YDR Property Taxes Chat

access_time Posted on: May 11th, 2012

Property Taxes Chat with Frank Countess

CGA Law Firm Attorney; Frank Countess

Read the recap of the live chat about property taxes with CGA Law Firm’s Frank Countess and York Daily Records’ Sean Adkins.

10:00 – Sean Adkins: Hi Frank. How are you?
10:02– Frank Countess: Doing very well this sunny Friday morning.
10:02– Sean Adkins: This is Sean Adkins. I’m filling in for Lauren this week.
10:04– Sean Adkins: Here’s our first question.
10:04– Comment From Larry Wolfe: Of all of the appeals handled by CGA, what is the average reduction (as a percentage of the original assessed value) in assessed value for its clients?
10:06– Frank Countess: The range of reductions obtained is between 10% and 50%. Where each property falls within that range depends on numerous factors: 1) location of home; 2) size of home; 3) age of home; etc.
10:06– Comment From Sue: What does assessed value mean?
10:09– Frank Countess: Good morning Sue. Assessed value is the fair market value (FMV) of a real estate parcel the year the last county wide assessment was performed. In York County, the last county wide assessment was in 2005. This number appears on both the spring tax bill and the summer tax bill that each property owner receives.
10:10– Comment From Michael Sopchak: Good morning, fellow participants.
10:10– Comment From Terry: do I find comparable assessed property rates for justification?
10:12– Frank Countess: At a tax assessment appeal hearing, the Board members are not interested in hearing testimony about how other properties are assessed. The Tax Assessment Board typically hears evidence of comparable sales of similar properties as presented by the property owner’s appraiser and attorney.
10:13– Comment From Larry Wolfe: Thanks for your previous response. A follow up: Your web page states that a 19% inflationary index is applied to the assessed value by taxing authorities, please illustrate in detail how that index is computed to calculate the tax on a $100,000 (combined land and improvements) property.
10:15– Do you feel that you’re paying too much in property taxes? Yes    ( 100% ) No    ( 0% ) I never really checked    ( 0% )
10:18– Frank Countess: Larry, I would be more than happy to present a math lecture on the Pennsylvania Common Level Ratio, but we do not have the time to do so at present. If you would like to make an appointment to meet with me, I would be happy to explain in more detail later. For now, suffice it to say that Pennsylvania assigns an inflationary percentage to each county on an annual basis. The inflationary percentage assigned to York County, based on the fact that York County last performed a county wide assessment in 2005, is 1.19.
10:18– Comment From Michael Sopchak: There we go. There’s just a little time delay. Mr. Countess, how well do your assessment reduction appeals go in York City vs. surrounding tax districts?
10:22– Frank Countess: My success ratio in tax assessment appeal cases is the same throughout all of the taxing municipalities in York County. However, how much time and resources they dedicate towards defending these cases varies greatly. York City is one of the municipalities that typically raises a defense and watches the proceedings carefully.
10:22– Comment From Terry: Is an appraisal report necessary if using comparable assessed properties as justification?
10:22– Frank Countess: An appraisal is essential to the process. Other assessed values are not considered.
10:23– Comment From Terry: How do I find what comparable homes in my area recently sold for and how far back should I document?
10:23– Comment From Larry Wolfe: Thanks again. If Sean sends this one through, I promise it’s my last: What is the average or mean cost (including all filing, legal, and appraisal fees) of filing an appeal for reassessment using CGA?
10:24– Frank Countess: Hiring an appraiser is the best way to find out the answer to what comparable homes have sold for recently.
10:25– Comment From Terry: How do I establish current market value for my property?
10:26– Frank Countess: Larry, again more information is need to answer your questions accurately. It depends on many factors, including residential, commercial, municipality, etc.
10:27– Comment From Rebecca Cook: my house was assessed at 279,000 in 2005. it appraised at its sales price of 316,000 in 2005. we refinanced in 2011 and the house appraised at 300,000. based on these facts, would a tax appeal be likely to succeed? We live in York City.
10:29– Frank Countess: Terry, the best advice we can give you is to hire a competent attorney and appraiser to establish the current market value for your property. Make sure to check their credentials and expertise in the field of real estate tax assessment appeals.
10:29– Comment From Michael Sopchak: My wife and I own five rental properties; four in York City and one in Spring Garden Twp. Surely FMV in both locations is much lower than it was in 2005; yet the 2012 property taxes are much greater. What a country!
10:31– Have you ever appealed your property taxes? Yes    ( 45% ) No    ( 55% ) I can’t remember    ( 0% )
10:32– Frank Countess: Rebecca, it depends. We would need to review your appraisal and check to see if there are more current comparable sales to make a determination as to whether or not a tax assessment appeal would likely meet with success in your case.
10:32– Comment From Michael Sopchak: Does that inflationary index of 1.19 suggest that FMV’s are increasing by (compounded) 19% per annum in York County?
10:34– Frank Countess: Mike, what it means is that the Commonwealth Department of Revenue believes real estate values for all parcels in York County have appreciated an average of 19% in value from 2005 until the present time.
10:35– Comment From Bill: We contacted an Appraiser, but he wants paid in cash. Do you know why?
10:37– Frank Countess: Bill, it is standard in the residential appraisal industry for appraisers t o require their payment before the services are rendered. In the commercial appraisal industry, the fees are typically much higher and the appraisers typically provide payment terms.
10:37– Comment From Sue: Thanks, Frank. Many of the homes in my neighborhood are selling for much less than what my neighbors paid. Does this help any chances I may have in appealing?
10:37– Comment From Bill: Is an attorney needed at the hearing?
10:38– Frank Countess: Sue, absolutely.
10:39– Comment From PFS: It is more likely that a favorable reduction in assessment will bring real tax savings with a $1,000,000 property than with a $50,000 property. Broadly speaking, is there a “sweet spot” in the real estate market where the an anticipated reduction in property taxes based on a reduced assessment will likely cover the cost of the appeal over 1 year? 2 years? 3 years?
10:42– Frank Countess: Bill, while an individual can attempt to represent themselves in these proceedings, as it is permissible in all types of legal cases, it is definitely not recommended. The largest volume of dissatisfied property owners navigating the tax assessment appeal process are without a doubt those who proceeded without an attorney. I have had several attorneys contact me to represent them personally in their cases. That should tell you all you need to know.
10:42– Comment From Terry: If the Tax Board is looking mainly at the similar homes sales, is a current appraisal necessary? Does it still help with the appeal justification?
10:45– Frank Countess: PFS, you are correct in that the vast majority of residential properties in York County are not over assessed significantly enough to warrant the filing of a tax assessment appeal. The largest 5% of the residences seem to be the most over assessed. As that sector of the residential real estate market has been hit the hardest in this economy and has seen the greatest percentage drop in prices.
10:46– Frank Countess: Terry, the burden of proof in these hearings is on the property owner. As such, I would not advise showing up without an appraisal. The appraisal is very important to the process.
10:46– Comment From Michael Sopchak: Ditto on Frank Wolfe’s 10:23 post!
10:46– Comment From Michael Sopchak: So what might be a range of the total expenses referred to by Mr. Wolfe, for a single family home in York County?
10:47– Comment From Michael Sopchak: No surprise about York City there! But in your experience, what municipalities are least likely to raise a defense and hover over proceedings?
10:49– Frank Countess: Mike, again I can only provide a cost estimate when I have gathered all of the subjective material that relates to an individual parcel. I would be happy to evaluate and individual property for you and provide a cost estimate to appeal the tax assessment. You may contact me at 717-848-4900
10:49– Comment From Dean Friend: Is there a ratio of assessed value to market value or vice versa that one should consider before filing an assessment appeal. An example would be the market value of the home is approx. $100,000 and the assessed value is $90,000, or 90% of the appraised value of the home.
10:51– Frank Countess: Dean Friend, there are over 175,000 parcels in York County. No formula works for all these parcels. It really requires a cases by case determination by a professional.
10:51– Comment From Jason: Sorry, I sent that too soon. It’s impossible to get market value for my neighborhood because many of them are for sale but none are selling! Does that have anything to do with an appeals process?
10:52– Frank Countess: Jason, in the absence of good comparable sales, an appraiser will typically utilize neighboring properties that have been listed on the market for extended periods of time.
10:53– Comment From Michael Sopchak: And we all know that the PA Department of Revenue’s belief is totally counter to reality… Does this suggest that an appeal is more likely to succeed?
10:54– Frank Countess: Mike, to large extent….YES. Which is exactly why I started educating my friends, neighbors and clients a year ago to bring these cases.
10:55– Comment From Michael Sopchak: So I know what a residential appraisal costs. Mr. Countess, what range of legal professional fees might be typical for appealing on a single-family rental property?
10:56– Comment From Michael Sopchak: Gotta run now. Atty. Countess, thank you so much for your time and expertise!
10:57– Comment From Michael Sopchak: Sorry about the last question, Atty C.; don’t mean to be a gnat here!
10:58– Frank Countess: Mike, a case that does not get appealed past the Tax Assessment Appeal Board by any of the parties typically generates legal fees that are 50% of the first years tax savings.
10:59– Comment From Sue: What is the deadline to file an appeal?
10:59– Comment From Tom Kensington: When is the deadline this year for filing a tax assessment appeal?
11:00– Frank Countess: Sue and Tom, the deadline for filing a tax assessment appeal for residential or commercial property in York County through CGA Law Firm is July 1, 2012.
11:02– Comment From Larry Wolfe: As promised no more questions–just this comment: Since the assessed values have remained unchanged since 2005 and since the York County taxing authority hasn’t increased the millage rate in the last three years, the asserted 19% increase doesn’t seem to be particularly relevant…or did I miss something?
11:04– Frank Countess: Larry, real estate taxes are an asset based tax. You multiply the asset value by the millage rate to get the tax amount. Lowering your assessed value will always lower your taxes no matter what happens to the millage rates.
11:04– Sean Adkins: Well, if no one has any pressing matters, I’d say we’re going to wrap this chat up.
11:06– Sean Adkins: Frank Countess may be reached at 848-4900.
11:06– Frank Countess: Thank you Sean for hosting this chat. Thank you for all the great questions. Have a great day!!! Frank
11:08– Sean Adkins: Thanks again, Frank. And be sure to read the re-cap of this conversation in a Money & More section in next week’s paper! Signing off!!!
11:09– Frank Countess: Thanks again Sean.