Home values in Loudoun County have jumped 20 percent from last year, the sharpest rise in at least 15 years and a sign that other Northern Virginia jurisdictions are also in for hefty assessment increases.
The average assessed value of a home in Loudoun soared from $337,000 in January 2004 to $403,000 this year, Assessor William C. Gardner said yesterday.
Officials elsewhere in Northern Virginia, who are finalizing their own numbers, said they expect an upsurge as well. Arlington County Assessor Thomas Rice said taxpayers would see an increase "commensurate" with Loudoun's and noted that Arlington's assessments historically increase faster than in counties such as Loudoun that are beyond the Capital Beltway.
Rice noted that Arlington has had a 65 percent increase in assessments in three years -- not including this year's boost. "Nothing like that has been experienced before, as far as our records go back, and mine go back to the '60s," he said.
Alexandria Assessor Cynthia A. Smith-Page said she expects the increase in residential property values to approach, or exceed, 20 percent.
Fairfax County's chief financial officer, Ed Long, said he expects a double-digit percentage increase.
Job growth has buttressed the Washington region's status as an attractive place to move, luring people who are eager to buy homes and helping to spur price increases, economists said. Longtime residents are also taking advantage of low interest rates to buy more expensive housing, which also drives up prices, they said.
"You've just seen the growth throughout the entire Northern Virginia region," said Jason Schenker, an economist with Wachovia Bank. "You have an increase in demand [for housing] and you've got a relatively limited supply."
Schenker said buyers have also been rushing to purchase homes before expected increases in interest rates.
"People on the street know what interest rates and mortgage rates are going to do," he said. "Why would you wait if you can afford it?. . . . That's really fueled a boom -- people trying to get in under the wire."
This year's assessment increases, which have also been seen in Maryland, follow other steep rises in recent years, leaving homeowners with more valuable property but with more burdensome tax bills. The increases have left politicians with fundamental choices about government spending, because rising assessments mean more local government revenue unless there are substantial tax rate cuts.
"It's easy to say, 'Listen, we didn't change your tax rate. Your house is worth a lot more,' " said Robert E. Lang, director of the Alexandria-based Metropolitan Institute at Virginia Tech. "I don't think the double-digit growth rate in house value is sustainable. When it slows, the counties are going to have to face that reality. They'll have to adjust."
Some residents on fixed incomes, including the elderly, can be hit hard by the rising assessments, prompting some counties, including Loudoun, to make relief programs more generous.
"I don't want to see people forced out of their houses because they can't afford the taxes. That would be criminal," said Loudoun Supervisor Jim Clem (R-Leesburg).
The swift assessment increases in Loudoun, the nation's fastest-growing county, have come as the population has surged, igniting a sharp debate over taxes and growth. Some officials have called for tax-rate cuts to lower the impact of soaring home values on current homeowners, while others have warned that sharp spending increases are required to provide schools and other services for the rush of new residents.
Lang, who lives in Fairfax County, said that although he dislikes paying more taxes in the form of higher assessments, he has seen in his research that many other areas across the country, including the Northeast, have it worse. "All deprivation is relative," he said.
Loudoun's residential assessments rose 11 percent last year, 8 percent the year before, and 17 percent the year before that.
"Everybody keeps saying, 'This can't keep happening,' " Gardner said. "But it keeps happening."
