Lakewood, NJ: The 2017 Property Reassessment

Within short order, virtually all Lakewood, NJ, property owners will have received a letter from the Township of Lakewood Municipal Tax Assessor informing them of the newly assessed “fair market value” of their property.

This is the latest step in the first full reevaluation of Lakewood Township properties in a decade, carried out by an independent property assessment agency, ASI NJ, under the auspices of the Municipal Tax Assessor. Understandably, this notice has made many property owners apprehensive about what their future property tax bills will look like, especially since the current assessed fair market value of virtually all properties is significantly higher than the previous assessment was.

It is crucial that property owners do not apply the existing tax rate to the new assessment, since the tax rate for 2017 will be significantly lower. The 2017 tax rate will be determined during the summertime. Property tax bills will reflect the new rate for the third and fourth quarters of 2017. Adjustments will be made to compensate for the under/overpayment during the first two quarters.

What’s important to know now is that the current total assessment of the value of Lakewood properties is roughly 50% higher than the total value according to the old assessment. Hence, if the total tax levy (the municipal, county and school district budgets covered by property taxes) would remain the same in 2017 as it was this year – it is expected to vary slightly – a home reassessed at 50% higher would pay the same amount in taxes in 2017 as in 2016.

The rule of thumb is that if your new assessment is around 50% higher than your previous assessment (e.g., $300,000 to $450,000), your tax bill will remain around the same next year. If the rise is below 50% (e.g., $300,000 to $400,000), you should be paying less in taxes. If the rise is above 50% (e.g., $300,000 to $500,000), you should be prepared to pay more.

According to Ed Seeger Jr., CTA, the Municipal Tax Assessor, there is a good chance that many homeowners will see very little increase or even a decrease in their taxes for 2017. A factor in this is that vacant lots have been reassessed to reflect their true value, based on the homes that can be built on them, removing some pressure off existing homes. The homeowners who will be seeing an increase in their taxes – some will be significant – mostly likely constructed an addition, finished additional rooms in their home, or reside in neighborhoods where property values have increased at a higher pace in recent years.

“I think my assessment is too high. What should I do?”

If you are among the less fortunate property owners and are bracing for a tax hike – or otherwise believe your assessment is too high – there is thankfully recourse to ensure that your final new assessment is accurate and fair. “This was a mass assessment of 26,000 properties, which will inevitably contain some errors,” explains Mr. Seeger. “You have only one property to worry about, so do your homework.”

The first step is to ascertain that the empirical data that was relied upon to make your assessment is accurate. The assessment notice you received in the mail includes instructions on how to receive a “property record card” with information such as property size, home size, bedrooms, bathrooms, etc. If there is erroneous information on there that may have led to a high assessment, make note of it immediately.

It is important to remember that the assessments have not yet been officially certified by the Municipal Tax Assessor. That is expected to take place sometime in January, after which you will receive an official Township postcard with the information.

For now, ASI NJ can still make adjustments to the assessments, which will then be officially certified. Your current assessment notice contains instructions on how to set up an appointment (within 15 days of receipt of letter) with ASI NJ to find out more information about your assessment and/or explain why you believe an adjustment should be made. After hearing from you, ASI NJ may decide to adjust the assessment, but a re-inspection of your home will often be necessary.

Even if the empirical facts of your assessment – square footage, bedrooms, etc. – are accurate, you can still contend that the assessment is too high based on other factors.

In the interest of full transparency, you can access information regarding assessment, sales and more of all Lakewood properties on ASI NJ’s website, asinj.com. This serves as a treasure trove of information to help you assess whether you have sufficient data to contend that your assessment is too high.

Mr. Seeger stresses that comparing your assessment to the assessment of other similar properties is typically not an effective argument. Neither is it typically effective to cite certain factors that may bring down value in a generic real estate market but don’t affect the prices of Lakewood properties. “Lakewood has a very unique real estate market, and the assessments reflect that,” says Mr. Seeger.

The most effective approach is to compare your assessment to actual sale prices of similar properties, in your neighborhood, during 2015 and 2016. This information can be gleaned on the ASI NJ website. If your assessment seems inflated when compared to recent sales, you would want to share that with ASI NJ.

Once the ASI NJ hearing deadline passes and the Township certifies the assessments, you can still file an appeal with Township and County authorities by May 1^st, 2017. However, the official appeals process is typically more cumbersome and costly than it is to make adjustments at this stage.

Mr. Seeger expresses sympathy for those who are facing a tax hike, and validates many of the arguments against basing property tax rates on current property value. However, he stresses that the current property tax and assessment structures are determined at the state level, and all New Jersey municipalities must follow them. “No one likes paying more in taxes,” Mr. Seeger says candidly. “However, all Lakewood property owners can rest assured that this process was, and continues to be, carried out in the most professional, fair and transparent manner.”

If you have any additional questions regarding the reassessment process, The Lakewood Vaad offers its assistance at 732.961.1161. If you are contemplating meeting ASI NJ or filing an official appeal, consider contacting a qualified real estate appraiser or attorney to help you review and/or present your case.

This report is presented by The Lakewood Vaad.

{Matzav.com}