With real property taxes constantly on the rise in Baltimore City, many wonder: What’s leading to these increases? What are property assessments? And how can incorrect assessments be challenged?
Property assessments are an estimate of the current market value of a property used to calculate annual property taxes. In Maryland, one-third of properties are reassessed each year. And these property owners are sent an assessment notice in late December.
In Baltimore, assessors use the mass appraisal and income approach – meaning properties are appraised in groups without going inside individual homes. Such appraisals often are based on such things as sales data, revenue generated by commercial properties and surrounding landmarks like a golf course or waterfront.
Baltimore property taxes are among the highest in the country – ranking 490 out of 3,143 U.S. counties based on the average tax. Since 2016, Baltimore property assessments have increased about 8% each year. Assessors realize the inequities that come with mass appraising homes in Baltimore City, recognizing it’s easier to mass appraise in the county where homes are more similar than in the city where homes tend to be more unique. The mix of residential and commercial properties also make mass appraisals unreliable because business owners infrequently report their profit and losses and homeowners are not generating revenue from the businesses in their neighborhood.
Another issue is including attractions in property assessments such as waterfronts, the Baltimore Zoo and golf courses. These attractions often raise community property valuations with no monetary benefit to homeowners living in the neighborhoods. The Maryland Assessment Work Group recognized such inequity and found that for assessments to be accurate, in-person inspections “are necessary on some periodic basis.”
For years, the Baltimore City Property Tax Assessment Appeals Board has wrestled with a growing backlog of appeals due to alleged inequities and inconsistencies with property assessments. Despite thousands of appeals being filed each year, only about 30 to 35 percent of these cases win relief at this level, and the percentage would be higher if homeowners knew how to prepare.
Homeowners should not be discouraged if they receive a notice of assessment that they believe does not reflect their actual property value. There are three times when homeowners can challenge their property assessment: (1) at the time of the reassessment notice; (2) during a Petition for Review; and (3) when the new owner purchases the property.
Appeal on Reassessment: When a homeowner receives their notice of assessment in December, they have 45 days to appeal. The notice of assessment includes an appeal form that explains the appeals process with instructions to complete the form. The Maryland Department of Assessments and Taxation attempts to complete all reassessment appeals by June 1.
Petition for Review: If the homeowner misses the deadline to appeal or circumstances cause the property to decline, the homeowner can appeal an assessment the following year after receiving the notice of assessment. The appeal must be mailed to the local assessment office before the first business day following January 1.
Appeal upon Purchase: An appeal can be filed within 60 days upon a property transfer between the months of January 1 and June 30. However, the new deed must be recorded prior to filing an appeal and the appeal must be filed within 60 days of the transfer.
There are three stages a homeowner can go through when appealing their property assessment. Each stage of appeals is reviewed by an independent agency, which has a different set of requirements. At each stage, the homeowner should consider whether the appraised value reflects the market value of the property and similar comparable properties; and whether any errors have been made in describing the property. When appealing, homeowners can request: (1) a property worksheet describing their home (e.g., number of bathrooms, condition of the property); (2) complimentary property and area sales listings; and (3) property worksheets of comparable properties ($1 fee per comparable worksheet).
For more information about property assessment and appeals, visit: https://sdat.dat.maryland.gov/RealProperty/Pages/default.aspx
While very real concerns about property assessments exist in Baltimore City, homeowners do have rights to appeal and can be successful if they know what evidence to bring and how to present their case. For assistance or more information, contact Maryland Volunteer Lawyers Service at mvlslaw.org/free-legal-help.
This article was written by Maryland Volunteer Lawyers Service Deputy Director Margaret Henn and Legal Intern Kamryn Washington.