A recently finished appraisal of Swain County real estate concluded that property values have increased by 16.5 percent on average since the previous valuation eight years ago.
“I think the revaluation that we had this time is going to be a good one,” said Swain County Manager Kevin King.
Tim Cain, a consultant with the Raleigh-based Assessment Solutions, spent the last 2.5 years visiting all 12,000 of Swain County’s homes, buildings and tracts of land and assigning them a value — giving him a wide-angle view of the county real estate market.
While some are surprised by the overall increase, Cain said to understand the results of the revaluation, you have to look at individual neighborhoods.
“If you look at it from 20,000 feet, there is no rhyme or reason,” he said.
The middle-of-the-road homes held their value or increased some, particularly in Bryson City, the center of Swain County’s tourism industry. If a town builds a stronghold of residential homes, commercial properties follow behind — like they have done in Bryson City.
“If I am going to open a Bojangles, I am only going to build it where the people are,” Cain said. “That is a vote of confidence in Bryson City because they expect the people to be there.”
Realtor Beverly Miller said from her perspective, the county fared well during the recession, in terms of property values.
“Our values have stayed fairly good,” Miller said.
And after years of stagnation, properties have recently begun moving off the market.
“I’ve seen more activity in the last six months,” Miller said. “Business has picked up a bit. We foresee a good future.”
But not everything is on the up and up. The value of high-end houses and trailer homes both declined during the last eight years.
“Basically, anything that was over $300,000 just got hammered,” Cain said.
Prices on the trailer homes have not gone up because banks are not loaning people money to purchase them, so the cost must stay low in order to move them off the market, theorized Miller.
The value of developable land also declined because the values had increased exponentially at one time.
“A lot of these had been ran up some in the period before (the recession),” Cain said.
In many cases, developers purchased the land and either planned to build homes or sell lots at a premium. When the recession hit, the values of the parcels sank and development stopped. In some cases, the developer deserted the property.
Although increased property values often translate to greater revenues for the county, King said the increase doesn’t automatically equate to a big boost in the county’s budget, which he is in the process of finalizing.
“It’s kind of misleading. I have not gotten any concrete numbers,” King said. “Technically, we might be flat.”
The county collected about $1.2 million in property taxes this year, King said, and may only bring in an additional $100,000 or $200,000 in tax revenue next year as a result of the revaluation. That will depend on how the appeals process goes. Each landowner has the right to contest the value awarded to his or her property once the assessment is over.
The county’s proposed budget keeps the tax rate the same, at 33 cents per $100 of valuation.
A complicated process
The revaluation was difficult because of a lack of sales in recent years. During the more than yearlong process, assessors considered any changes to a property and what similar plots have sold for. But if properties aren’t moving, it is hard to gauge what they are worth.
Nonetheless, each was assigned a value, and the information was mailed out to property owners — 763 of whom appealed the values, arguing that their lots were worth more or less than Cain’s assessed price.
In total, owners appealed the values of 1,194 properties, the majority of which were characterized as vacant or unimproved properties. After the informal appeals process, more than 70 percent of the values were changed.
Back in 2009, Swain County completed a property revaluation, but the data used in it was from 2007 — when the U.S. was reaching the apex of the real estate boom before the bubble burst and the country tumbled into a recession.
“The timing was terrible,” Cain said. “If you look at us today from where that last revaluation is, we are down 38 percent. That is huge.”
Out of the estimated 11,000 parcels valuated in Swain County at that time, more than a fourth of were appealed.
County leaders decided not to accept the revaluation, which would have taxed citizens based on old, overly inflated property values. Instead, the state General Assembly passed a bill making the assessment null and void, and Swain County postponed the revaluation until the economy began improving.
The state requires counties reassess all its properties — commercial and residential — at least once every eight years.
Rolling out the budget
The Swain County Board of Commissioners will present its proposed budget for next fiscal year at 5 p.m., Thursday, June 13. County leaders have been waiting until the property revaluation was completed before presenting the first version of the budget because the results would determine if the tax rate changed or not.