The rise in property values in Arlington is accelerating post-HQ2.
Late last week Arlington County announced that its assessments for 2020 had risen 4.6% on average — 4.9% for commercial properties and 4.3% for residential properties. That compares to an average property assessment increase of 3.5% last year.
The rise in property values will almost certainly mean a rise in property taxes for Arlington residents. The county, in its announcement, seemingly discounted the idea that tax rates — currently $1.026 for every $100 in assessed value — would come down to offset the rising assessments.
“Although the growth will result in additional revenue, the County faces continued funding choices in the coming fiscal year,” the county’s press release says in the first paragraph. In November the County Board directed County Manager Mark Schwartz to propose a budget that either keeps the tax rate steady or slightly lowers it; his budget proposal will be released in February.
The county says Amazon’s arrival is at least partially responsible for rising property values, though apartment buildings accounted for much of the commercial assessment increases.
Commercial property values were driven by a decline in the office vacancy rate, continued new construction, demand for rental properties, and Amazon-related leasing activity. Apartment property values increased by 8.9 percent, office values increased by 2.5 percent, and general commercial property (malls, retail stores, gas stations, etc.) grew by 1.8 percent.
“Arlington continues to be a place where people want to live and work,” Schwartz said in a statement Friday. “The investment we make in our community through real estate tax revenue helps us maintain the high-quality amenities and public services that make Arlington so attractive.”
The full press release is below, after the jump.
Property values in Arlington rose for 2020, continuing steady growth from 2019 in both the residential and commercial sectors. Although the growth will result in additional revenue, the County faces continued funding choices in the coming fiscal year.
Overall, the total assessed value of all residential and commercial property increased by 4.6 percent, compared to 3.5 percent the previous year. Commercial properties saw the largest increase at 4.9 percent overall, while residential properties increased 4.3 percent.
Last year, real estate taxes provided 57 percent of total County revenues. The County’s real estate tax base is spilt roughly equally between residential (51%) and commercial (49%) property assessments.
Commercial property values were driven by a decline in the office vacancy rate, continued new construction, demand for rental properties, and Amazon-related leasing activity. Apartment property values increased by 8.9 percent, office values increased by 2.5 percent, and general commercial property (malls, retail stores, gas stations, etc.) grew by 1.8 percent.
About 85 percent of residential property owners saw their assessed value go up while the rest remained unchanged or went down. The average home value, inclusive of condominiums, townhouses and detached homes, is $686,300.
“Arlington continues to be a place where people want to live and work,” County Manager Mark Schwartz said. “The investment we make in our community through real estate tax revenue helps us maintain the high-quality amenities and public services that make Arlington so attractive.” […]
While Arlington County’s property values have shown steady, measured growth over the past couple of years, the County still faces choices as it develops an operating budget for its 2021 fiscal year.
Funding commitments for schools and Metro, as well as priorities in affordable housing and County infrastructure, place continued pressure on the County budget. Arlington Public Schools (APS) receives 47% of every tax dollar, which in FY 2020 equaled $522.4 million of ongoing funding and $9.9 million in one-time funding.
In fall 2019, the County Board directed the County Manager to include no real estate tax rate increase in his Proposed Fiscal Year 2021 Budget, and to provide options for incremental increases in funding for affordable housing. The Board also directed the Manager to propose long-term efficiencies and improvements in service delivery and directed that any new programs or expansion of existing services should be funded by increased revenue, including fees, or reallocations.
The County Manager will present his budget to the County Board in late February.
Real estate assessments are appraisals. They are the County’s opinion of fair market value for each parcel of real property in Arlington. Assessments are made using accepted methods, standards and techniques of the real estate appraisal and assessment profession.