More value has been put on land and relatively less on buildings on this year's District of Columbia real estate tax rolls, the city's chief assessor said yesterday.
Assessor Donald R. Beach said the shift should have little or no effect on the amount of taxes a typical homeowner will pay. But he conceded that a rise in land values could increase economic pressures for demolishing old buildings and replacing them with new, modern structures.
The move toward higher land assessments became apparent the past few days to thousands of city taxpayers who have just received notices of the new valuations on their real estate. The new valuations form the basis for tax bills to be sent out next fall.
For example, one taxpayer in the 2900 block of O Street SE, in Anacostia, had a total valuation that increased from $34,174 last year to $37,605 now. But the valuation of the home itself -- a semidetached brick house built in 1937 -- declined from $25,875 to $18,885 while the value of the land increased from $8,299 to $18,720.
Overall, according to an announcement last week by the D.C. Department of Finance and Revenue, assessments on single-family homes -- the lots and buildings together -- are up 18.6 percent from last year. A downward adjustment of tax rates mandated by city law is expected, however, to hold the average increase in tax bills to 7 percent.
Beach said the shift of tax valuations from buildings to land is being done to remove inequities within neighborhoods as well as among neighborhoods throughout the city.
There have been numerous instances, he said, in which land values and house values within a neighborhood vary widely, while the total values are fairly close.
By law, assessments are based on the full estimated market value of each property. In practice, the tax valuation lags about two years behind the real value, easing the burden to homeowners of rising values.
"We can't exceed the market value -- no way," Beach said.
Vacant lots are "probably worth gold" now, Beach said. One property owner in the Forest Hills area of Northwest said the valuation on a lot adjacent to her home was increased 128.5 percent. Another owner in Hillcrest, in far Southeast, said a similar vacant lot that forms part of his backyard rose in value 130 percent.
According to records in Beach's office, the value of both land and dwellings increased in most of the 56 neighborhoods used for assessment purposes. However, the rise in land values was much sharper than the values of the buildings. There were no total citywide figures.
In Anacostia, for example, the total value of land nearly doubled from $10.8 million last year to $20.4 million now, while the value of the structures rose only from $27.2 million to $28 million. "We're beginning to get an increase in the market (sales), but they haven't begun to rehab the houses yet," Beach explained.
In 16th Street Heights in Northwest, the area of the city that had the slowest value growth in the past year, the land assessment increased from $27.5 million to $59.9 million, while the assessment on the homes -- many of them large, free-standing structures -- declined from $66.2 million to $48.4 million.
In Massachusetts Avenue Heights, the Embassy Row neighborhood where total individual valuations topped $200,000 for the first time in city history, land values increased from $12.1 million to $18.4 million while dwelling values remained fairly steady, rising from $20.7 million to $21.9 million.