New York City is worth more today than any time in history, the city Department of Finance has determined a whopping $616 billion.
The tentative billable assessed value for the fiscal year 2006 that begins July 1, 2005, is $110.2 billion, also the highest on record and 7.65 percent more than last year.
What is known as the “actual” assessment totals up to $123,593.8 billion. The good news is that this trend will probably continue upward, which gives the city more borrowing power. The bad news is that the city is just as likely to try to raise more money from taxes paid by property owners as through its bankers, which means taxes are also likely to rise.
This should be no surprise to anyone who follows real estate. If apartment and office rents are climbing, so are owner revenues, and that shows up as a higher assessment. A state law ensures co-op and condo apartments are not assessed based on their sales value but on the value of the income of a comparable rental. But as luxury and rent-regulated rents also increase, those property classes have also seen pronounced upticks: Billable assessments for Class Two are up 9.08 percent, with condos seeing an 11.77 percent rise and co-ops a 7.65 percent rise. Rental buildings are up 9.06 percent. If the building is a condop, it was hit harder: 12.8 percent is the change over last year in billable assessed value.
Finance Commissioner Martha Stark also changed the equalization rate for Class One homes, recognizing that some have been assessed in an unequal manner. About 30,000 properties have seen changes, primarily in areas with a lot of new construction. The entire Class One bracket rose 5.57 percent in billable assessed value with condominiums being brought down 9.06 percent.
Stark said she hasn’t seen “any evidence” to chase down Class II and Class IV rates. Many in the property-tax business, including appraisers and lawyers, believe the number is closer to 30 percent than the 45 percent equalization rate used for those classes.
Commercial property was up 7.62 percent citywide in billable AV and 12.68 percent in its actual AV. Commercial condominiums experienced the bulk of that increase, a whopping 22.13 percent in actual AV and 15.03 percent in billable. Should we blame it on the value kicking in on the Time Warner retail block? Why not? But if you had any kind of store property, the AV went up 19.45 percent in actual and 9.93 percent in billable.
Also, even though the number of vacant parcels dropped due to development by about 100 in commercial zones, due to the increase in the prices people were paying to buy the land, the value of the remaining 9,234 parcels rose by 21.20 percent in actual and 7.63 percent in billable AV. With vacant residential land assessed in a different manner, even though nearly 1,300 parcels were developed, their total actual and billable AV dropped 1.15 percent, but that drop is not likely to be reflected in the value of an individual parcel. The good news for developers is that there are 26,160 parcels left.
Owners can file an application to correct the tentative assessed value with the Tax Commission. These applications are technically filed at the Department of Finance and moved over to the Tax Commission for hearings.
Applications are due Tuesday, March 1, for Class One properties while all others have until Tuesday, March 15.
If you miss the deadline, don’t complain when you get your tax bill in June. Not only is it too late in June, but years ago, the New York State Supreme Court shot down a case where applications were attempted to be filed a few minutes after the door closed at the end of business. Like the New York State Lottery, you have to be in it to win it.