Chronicle Editorial

You get what you pay for

     In this issue of The Chronicle, we investigated the process by which most of the community received a notice of increased property values. Many were and are still confused about a certain discrepancy that exists between what the government believes properties are worth, and the amount they can actually be sold for. Many are probably in disbelief that their property can be worth so much.

     If you’re in the camp that believes that your property is worth less than its new assessed value, then you’re confronted with the annoyance that not only is you property not actually worth the paper price on the market, but now you have to pay higher taxes on it. For instance, if you’re property value went up $10,000, and the city tax rate is approximately 13 cents per $1,000, your taxes went up $130, while you’re left holding property you don’t think will sell for that value.

     It’s important to remember however, that while the assessed value might have increased, a property is only worth however much someone else will pay for it.

     Market research of home sales in Hampton shows that prices have gone up, meaning that all properties around those sale locations are also going to increase. In actuality, rising home values are a benefit to all, provided that regular maintenance on your home has kept up.

     To those that have kept up on plumbing, roofing, landscaping and carpet maintenance, increasing valuations work out in your favor. If you bought your home in 2010 and have your property up to age standards, should you choose to sell your house, based off reported numbers in town, your property could be worth between $7,000 - $15,000 more than when you purchased it. If you’re house is in pristine condition, then you stand to make a lot more money on the open market, given the rising property values, lack of housing opportunities and the mint condition of the home. In turn, that sale would also increase property values.

     However, if you haven’t kept up with maintenance, then it is true that you probably couldn’t sell the house for the new assessed value. It’s important to remember that the assessed value made by the auditor doesn’t take into account how old a roof is, or how good the kitchen tile is, or the condition of the plumbing. If all those areas are shortcomings, then the house could lose money on the open market. Herein lies the disconnect.

     Increasing property values are good. They’re good for the government and they’re good for the free market. Having a house worth more means an increase in one’s assets. You have something worth selling. Increased value means more taxes to the city and county, and more taxes means building better roads and bridges, better parks, better water and sewer systems and upgraded schools, all in turn, raise property values because of excellent infrastructure. It’s also good for the economy, meaning people make more money to spend on more things, which in turn creates more money in the system.

     The increase in values should not spur discontent about over-taxation. It should be a market signal to invest in one’s property to foster rising values to increase assets.