Home assessments in Arlington County have risen sharply -- increasing by 24 percent this year -- the county announced yesterday, as the real estate boom continues to drive up home values throughout the region.
The average assessed value of a single-family home increased from $369,600 to $458,200 this year. That brings the total jump in the last three years to 70 percent.
County Board Chairman Jay Fisette noted that it is harder to find housing.
_____Growth and Development_____
County Restricts Residential Growth (The Washington Post, Jan 12, 2005)
Md. Home Valuations Increase Sharply (The Washington Post, Jan 6, 2005)
Swift Maneuver Expedites Rezoning in Prince George's (The Washington Post, Jan 4, 2005)
Loudoun Cautioned About Swap (The Washington Post, Dec 23, 2004)
Rezoning Bid Offers Millions For Road Work (The Washington Post, Dec 22, 2004)
The rapid growth is in keeping with residential home values in other affluent counties close to Washington, such as Montgomery, which also saw residential values jump nearly 70 percent in the last three years. Loudoun County home values are already up 20 percent over last year, and similar increases are expected in Alexandria and Fairfax County when assessments are mailed next month.
"Certainly it's a landmark increase in property values," said Arlington Assessor Thomas L. Rice. "This is without question . . . the longest protracted period of residential growth we can document."
The increase comes at a time when the county's financial advisory panel has warned that Arlington cannot continue to spend more money based on its burgeoning property tax coffers -- anticipating the day when the boom goes bust -- and officials are struggling to solve a growing crisis in affordable housing.
"In many ways, we're victims of our own success," said County Board Chairman Jay Fisette (D). "Most communities love to see increases in home values. It means things are healthy, there's investment and a high quality of life. But the flip side is that it makes finding housing challenging."
It also means rising property tax bills. Republicans are already calling for a substantial cut in the county's tax rate of 95.8 cents per $100 in assessed value, to provide some relief to taxpayers.
Without the right to levy income taxes on their residents, Virginia localities depend heavily on real estate tax revenue. Also, there is no cap on property tax increases, as there is in Maryland and the District.
Fisette said the size of any cut in the tax rate would not be decided until the budget is presented next month.
County officials said that the new numbers underscore the county's growing housing crisis for low- and middle-income workers. Arlington lost 47 percent of its affordable rental units between 2000 and last year. "The Washington region is experiencing housing costs that are outstripping wage increases, and this is a huge problem for moderate- and low-income wage earners," said Cheryl Cort, executive director of the Washington Regional Network for Livable Communities.
The county's affordable housing program was dealt a blow in December when its guidelines, which asked developers to reserve 10 percent of any new homes for moderate-income residents, were ruled illegal by an Arlington County Circuit Court judge.
Fisette said yesterday that the county had decided to appeal that decision. "We believe that the actions we took were appropriate and justifiable in light of the huge challenge our community faces," he said.
A citizens panel that advises the County Board on financial issues warned recently that Arlington needs to stop spending money at the same rate based on its growing property tax revenue. In a study, the panel found that the amount of the county's budget funded by property taxes increased from 40 to 50 percent over the last five years.
"What we said was that there has been a really rapid rate of growth in the value of property and county expenditures," said Peter Rousselot, the panel's chairman. "If that fell back to where it was in the early to mid-1990s -- where we had several years of negative growth -- the county would automatically and quickly be into a big deficit. . . . Let's not wait for the bubble to burst before slowing expenditures."