Real Estate

Want a property tax refund? Consider challenging appraisers’ assessments

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Most people aren’t aware that real estate brokers can help in obtaining thousands of dollars in property tax refunds for them. How can they do that? It’s really quite simple.

Experts estimate that between 30 to 60 percent of taxable property is overassessed. Yet, fewer than 5 percent challenge their assessment, even though the majority who do so win at least a partial victory with a properly prepared presentation.

Overassessments partly happen because property appraisers have a tremendous amount of properties to assess. They use mass appraisal techniques and cannot visit all the properties. They often inspect many by driving by, taking photos of the exterior and looking at Google maps, assuming they are all in reasonable condition for their age. They typically do not get inspected inside. This is a great thing for the homeowner.

Your broker, in contrast to the property appraiser, can point out all the work that needs to be done on the property such as painting and remodeling bathrooms and of course any work that needs to be done outside, like roof repairs. A licensed professional, such as a broker can “suggest” things that may make your house more attractive and saleable.

The condition of the house, and not the fact that you choose to make the repairs, is what is important. Things such as needing a more efficient air conditioner unit, installing impact resistant windows, updating a terrible looking kitchen, replacing worn carpeting and other things, can often go a long way in reducing your assessment. Describe it as if it had the darkest black cloud above it. The sky is the limit in explaining why your house should have an assessment reduction.

Remember, nobody says you must make the changes; but only point them out to the property appraiser. You are essentially explaining all the costs a hypothetical buyer would incur in fixing up your property. These “needed improvements” coming from a third-party professional, such as a real estate broker, can often go a long way and may result in a hefty tax refund.

The homeowner is not in the business of having to show the property appraiser the lowest repair estimates they have. After all, the County is not in the business of charging you low property taxes on the wholesale level.

A little-known fact is that Florida property is required to be assessed at 100 percent of just value. But, as per Florida Statute 193.011, the property appraiser in Miami Dade will allow an additional 15 percent deduction from those values as their estimated “cost of sale” in arriving at their assessed values. In effect, even if you just purchased, your taxable assessment should automatically be 15 percent lower. As this is not always the case, that is another reason to appeal your assessment.

When deciding if one should file an appeal, people also often don’t understand that it’s not important that their property today may be worth more than what it is presently assessed for. Now in 2017, we are actually appealing the 2016 assessments, and by law, the property appraiser should use the 2015 sales to arrive at their assessed values. At that time, real estate prices were generally lower.

Get your broker excited by inviting him or her to come to your property. They will be glad to do so. The broker can also give you a list of 2015 recent sales for similar properties. You can then proudly show off those “comparable” sales during your tax appeal. Typically a broker’s listing information and pictures of properties that sold will look more beautiful than yours, as compared to your property with all the “issues” which you will point out during the appeal. Most sellers do fix up their properties prior to sale.

In Florida, there is no such thing as being a loser when it comes to appealing taxes. At a cost of $15, with a 15-minute hearing and a proper presentation, you can be armed and prepared to lower your assessment, with a nice refund for you. If in the worst case, your assessment is not lowered (which sometimes happens), you can at least feel good to know that your property has not been overassessed.

Barry Sharpe is the managing member and principal with the Property Tax Appeal Group (P-TAG), which provides expert and professional real estate ad valorem appeals on tax assessments in South Florida for retail centers, warehouses, apartments, condominiums, offices, hotels, residences and raw land. He is also a principal with Sharpe Properties, a property management firm. Both are based in Hialeah.

▪ This piece was written for the Broker’s View space in Business Monday of the Miami Herald. It reflects the view of the writer and not necessarily of the newspaper.

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