Michael Hill received a jolt last year when a private appraiser valued his Lawrenceville-area home at $55,100 less than Gwinnett County said it was worth.
A Gwinnett official later acknowledged the county had overvalued Hill’s entire neighborhood, making Hill anxious to see his new county appraisal when it arrived in April.
He got a pleasant surprise: Gwinnett had cut the value of his home for tax purposes by $69,000.
“[The assessment] is a lot better than it was,” Hill said. “That’s a good feeling.”
As reported by The Atlanta Journal-Constitution in December, the problem in Hill’s neighborhood illustrates the shortcomings of the mass appraisal system used by Georgia’s county assessors and the difficulty of valuing property in a market flooded by foreclosures and other distressed properties.
County appraisers and other experts say appraisal methods required by state law are not well-suited for responding to dramatic changes in the real estate market. Until recently, county appraisers had a hard time keeping up with fast-rising property values. Yet since the real estate market fell off, they haven’t been able to keep up with the decline.
That means thousands of properties across metro Atlanta are overvalued for tax purposes, leaving owners to pay higher tax bills than they would if their properties were accurately appraised.
Hill’s neighborhood is a good illustration. It includes 239 properties in the Fountain Lakes and Brickshire Park subdivisions. The homes were built in the early 2000s and originally sold for $175,000 to $225,000. By the mid-2000s they were worth $180,000 to $240,000.
Gwinnett Chief Appraiser Steve Pruitt said county appraisals in Hill’s neighborhood were on target in 2008 and might have been below market as late as 2009.
But by 2010 -- with a proliferation of bank sales in the neighborhood -- market values were falling fast. Gwinnett valued Hill’s home at $233,100 as of Jan. 1, 2010, based on neighborhood sales the previous year. Later in the year a private appraiser said Hill’s home was worth just $178,000.
After analyzing area home sales, Pruitt said county appraisals in Hill’s entire neighborhood were about 32 percent over market value.
Pruitt pledged to revalue the neighborhood. An inspector assessed the condition of properties in Hill's neighborhood. The county also reexamined land values and cut the value of homes and other improvements by 20 percent across the board in the neighborhood.
Pruitt said every property in the neighborhood was reduced, though individual homes saw varying reductions because of differences in condition and other factors.
Gwinnett cut the value of Hill’s home from $233,100 to $164,100. Hill won’t get a property tax bill until later this year, but the reduction in his home value could save him hundreds of dollars.
Hill has mixed feelings about his new appraisal.
“I am not pleased that my home has decreased so much in value,” he said, adding, “I am very pleased that Gwinnett County has finally recognized the price decrease, which will have a direct impact on what I pay out.”
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