In 2025, the tax value of most people’s homes and commercial property in Cumberland County — and possibly their property tax bills — are expected to jump significantly.
That’s because the county is going to update its appraisals of the real estate in the county to set new, updated tax values. State law requires them to do every eight years to ensure that the tax appraisals are current. The last revaluation was in 2017.
Cumberland County Tax Administrator Joseph Utley on Monday presented to commissioners a 362-page proposed manual, called “Schedules, Standards and Rules,” that the county tax administration office will use when determining the new values.
“The job of the county appraiser is to arrive at a reasonable estimate of market value,” the manual says.
The county commissioners have scheduled a hearing to take public comments on the revaluation processes and formulas in the manual. It’s set for 6:45 p.m. Oct. 21 in Room 118 of the Judge E. Maurice Braswell Courthouse.
Values went down in 2017
In the 2017 revaluation, the value of residential properties dropped 4.9%, while commercial properties rose about 4%, The Fayetteville Observer reported at the time.
Residential values had fallen, Fayetteville real estate agent Wendy Harris told CityView on Thursday, because the local housing market was flooded with homes for sale following the Great Recession.
Now the housing market has rebounded and the situation is reversed. Home values have risen dramatically, she said, because too few homes have been built to meet the demand.
Fayetteville City Council Member Deno Hondros, who is a real estate agent, told CityView the city staff estimated that properties in the city limit will see increases between 15% and 42%, with most falling somewhere in the middle.
At first glance, this might increase people’s property tax bills. But city, county and town governments can set tax rates to a “revenue neutral” level after the revaluations are complete. It depends what they decide, said University of North Carolina School of Government professor Christopher B. McLaughlin in a blog post about property tax revaluations.
How values will be calculated
The county’s Schedules, Standards and Rules real estate appraisal manual says that when setting a value for a residential property, such as a single family home, an appraiser relies heavily on market data and what comparable properties have sold for.
For commercial properties, appraisals are more difficult to make, the manual says, because commercial properties are bought and sold far less frequently than homes.
So for commercial properties, appraisers have two additional methods to set a value, other than a market value based on recent sales in the area, when assessing a commercial property’s value:
- First, they can consider the land value plus the cost of replacing the buildings minus any depreciation on the buildings. This is used on industrial properties that rarely change hands.
- Second, they consider the property’s market value in a formula along with the income it generates. This is often used for commercial residential properties, such as apartments.
Commissioner Jimmy Keefe at Monday’s meeting questioned the use of an income-based appraisal formula on apartments and other multifamily housing — as would be done with a strip shopping center — instead of a market value appraisal based on recent sales, as is used for a single-family home.
An apartment complex is full of families, and each family needs tax-funded government services, he said, while a shopping center needs comparatively fewer services, he said.
Keefe asked the county staff to do research to see how each appraisal method — recent market values of comparable properties vs. income the property generates — affects the appraised tax value.
County Manager Clarence Grier said the staff will bring back the data and the cost of providing services to families in apartment complexes.
Utley said state law doesn’t allow the county to assess an extra value to a property specifically based on the cost of providing services to its residents.
Senior reporter Paul Woolverton can be reached at 910-261-4710 and pwoolverton@cityviewnc.com.
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