The District government mailed out new real estate tax assessments yesterday, and the city's 120,000 residential property owners will soon find that their properties have increased in value by an average of more than 20 percent in the last year.
Since the city announced its annual reassessments a year ago, the average value of a single-family home in the District has jumped from $56,100 to $69,700. The city's least expensive houses are in Anacostia ($35,500) in Southeast Washington, while the most expensive are in the Massachusetts Avenue Heights area ($253,100) of Northwest.
Whether the new and higher property assessments will mean bigger tax bills for D.C. residents in the year starting July 1 was not immediately clear. Tax bills have jumped frequently in recent years in the Washington area as assessments have skyrocketed.
Under the District government's budget process, Mayor Marion Barry will recommend property tax rates in the next few months and then the City Council will set the rates.
If the current rates are enacted again, most property owners will have to pay sharply higher bills. But if the rates are lowered -- as has sometimes happened -- then the tax bite could remain the same or increase by relatively small amounts.
The District currently has three property tax rates -- $1.22 per $100 of assessed valuation for owner-occupied residences and apartment buildings with no more than five units, $1.54 for non-owner-occupied dwellings and $1.83 for large appartment and commercial buildings and vacant land.
The continued inflationary pressures on the value of residential property in the city were reflected in the assessment increases announced by Finance and Revenue Director Carolyn Smith. She said that the value of owner-occupied residential property increased by 22.6 percent in the last year and non-owner-occupied property, including cooperatives and apartments, by 20.1 percent.
But she said that other property in the District increased by only 8.7 percent in the last year, including a 9.2 percent boost in the value of commercial propery and 2.7 percent for garages and vacant land.
The overall average increase is 17.1 percent, compared with 15.3 percent a year ago.
The average increase in property values in the city's 56 assessment areas varied widely, ranging from a 3.5 percent boost in the Foggy Bottom area near the State Department to a 38.4 percent increase on Capitol Hill.
Assessments increased an average of 21.3 percent in Barry's home Hillcrest neighborhood in Southeast. Assessments increased by 33.3 percent in the Berkeley area in upper Northwest, by 35.2 percent in the Burleith area near Glover-Archbold Park and by 33.4 percent in the Spring Valley area near the Montgomery County line.
Jean Oliver, the city's assessment administrator, said the increase in the value of commercial properties was less than that for residential properties because higher interest rates and inflationary increases in business operating expenses have tended to hold down investors' net income, and therefore the market value of commercial properties.
The District reassesses the value of all 152,000 parcels in the District each year, with assessors personally visiting each property before any changes in assessments are made, Oliver said.
Current sales prices often help determine the value of neighboring residential property, Oliver said, but confidential income and expense statements also are used in setting the value of commercial property.
As in past years, owner-occupants of D.C. homes can receive an exemption on the first $9,000 of the assessed value of their property merely by filling out an application.
Applications for the so-called homestead relief will be mailed separately. Property owners who think their assessments are too high can file an appeal with the city's Board of Equalization and Review. Such appeals must be filed by April 15.