Home values increase 9.5 percent in Maryland – Baltimore Sun
It is the third year in a row of statewide increases, reflecting a gradual improvement in Maryland’s housing market since 2013. That was the last year the state reported declines, and the last time this group of properties was evaluated for tax purposes.
More than three-quarters of homes included in this year’s assessments gained value during the three-year period, for an average statewide increase of 9.5 percent. Values of commercial buildings, which include apartments, increased about 16 percent.
“The last time we assessed the properties was three years ago, and things had not quite started to recover,” said Joseph Glorioso, supervisor of assessments in Anne Arundel County. “It’s basically catching up.”
Baltimore County led the metro area. More than 87 percent of residential properties included in the new assessments saw values increase, for an average of 10.9 percent. The assessments covered the western part of the county, including Catonsville, Owings Mills and Glyndon.
Economist Anirban Basu, CEO of Sage Policy Group, said the gains should give local governments some more revenue to spend.
But he said elevated foreclosure rates, as well as slow economic growth generally, have led to only modest increases, especially when compared to the scale of the housing crash.
“One might have expected a more brisk rebound,” Basu said. “A robust housing market and home price recovery continues to elude Maryland.”
The state conducts assessments on a three-year rotation, with a third of all properties evaluated each year. More than 688,000 properties were included in this year’s assessments, which will be used for 2016 property bills sent in July.
Assessment increases phase in over three years, while declines in value go into effect immediately.
Baltimore’s assessment area covered about 69,000 commercial and residential properties in the downtown business district and the northern part of the city, a diverse group of neighborhoods that includes both Park Heights and Guilford.
Commercial property values in the city jumped more than 21 percent, as new apartment conversions came online and office vacancies declined, said Dale DeWeese, an area supervisor for the Maryland Department of Assessments and Taxation who oversees several jurisdictions including Baltimore.
But residential assessments increased just 4.9 percent from 2013 — about half the rate of the state.
Homes in downtown Baltimore and along the Charles Street corridor showed the most significant gains, with increases in the teens, DeWeese said, but the growth was uneven. About 49 percent of properties declined in value.
Neighborhoods that were more resilient during the housing crash haven’t seen appreciation pick up significantly, while foreclosures and short sales continue to set market prices in many places, said Joseph T. Landers III, a real estate agent and former city councilman.
Landers said his own property in Northeast Baltimore is one of the ones that declined this year.
“I’m sure the city’s disappointed that it’s not a larger increase,” Landers said. “I have mixed feelings about it because I don’t want to see the values decline in my neighborhood or the city overall. And yet at the same time, because of the high city tax rate, you don’t want to be overburdened. … It’s really a two-edged sword, a mixed blessing.”
In Howard County, typically the strongest and priciest housing market in the region, home values in the assessed area — including Ellicott City and Columbia — increased 7.3 percent from 2013.
In Anne Arundel County, where the assessment area included the eastern waterfront north of Annapolis and properties near Route 97, home values also increased about 10 percent.
Glorioso, of Anne Arundel County, said weak growth in home prices at the upper tier of the market affected several jurisdictions, including his waterfront territory. The new assessments are based on more than 55,570 sales statewide over the last three years.
“Properties sort of in the midrange of value seemed to be doing a little bit better,” Glorioso said. “Things at the higher end didn’t go up as much.”
County officials said Tuesday it was too early to say how new assessments will affect spending next year.
In Baltimore City, which is facing a $75 million shortfall but has the highest property tax rates in the state, Mayor Stephanie Rawlings-Blake plans to lower the rate for homeowners by one penny — in line with her pledge to reduce the tax rate by 20 cents by 2020, spokesman Howard Libit said.
In Baltimore County, any additional revenue is likely to go to the county’s school construction program, spokesman Don Mohler said.
Property owners are protected from dramatic bill increases by the Homestead Tax Credit, which limits how much taxes can increase each year based on the rising values of primary residences.
The Homestead cap, which varies across the state, is 2 percent in Anne Arundel, 4 percent in Baltimore and Baltimore County, and 5 percent in the other Baltimore-area counties.
In Carroll County, where home assessments increased 5.4 percent from 2013, this is the first year since the crash when some homeowners will see increases large enough to receive the credit, said Joseph Wagner, supervisor of assessments.
“It’s not going to be anything huge, but property owners should make sure they apply … and have been approved,” he said.
For Harford County, this year is the first time since at least 2010 that the average home assessment has increased, albeit by a modest 2.5 percent since 2013. The area assessed included the northern part of the county, Havre de Grace, and parts of Joppatown and Edgewood.
“The market did return and we didn’t get skipped on that,” said Nancy Schmidbauer, supervisor of assessments in Harford. “We saw our growth also.”
Charlotte Rogers, the supervisor of assessments in Baltimore County, said she expects to see gains continue in future years.
Basu said he does as well.
“Homeowners are not getting rich, that’s true,” he said. “But I think we can expect to see further appreciation in the year or two ahead.”