Approximately 15,000 Hoboken property owners will see their taxes either rise or fall after a citywide real estate reassessment, or ‘reval’ that begins this Monday.
Hoboken homeowners, many of whom are still recovering from Hurricane Sandy, and all of whom haven’t seen their property values be publicly reassessed since 1988, will face a change based on whether their home is old or new.
Representatives from Appraisal Systems, Inc., the private company that won a city bid to conduct the revaluation, gave a presentation to around 150 residents at Hoboken High School Thursday night, explaining the nearly six-month process. After inspecting the exterior and interior of every property in Hoboken and analyzing the sales and market trends of the past few years, the appraisers will reassign each property a new value, though they won’t have any say in what the city chooses to do with the data.
Owners of an old Hoboken home who have been paying taxes based on its value in 1988 may see a tax hike when they start paying taxes based on the current market value. Conversely, people who purchased a property for a lot of money during the real estate boom 15 years ago may see a slight drop if the market value is lower now.
But whether each person sees an increase or decrease depends on several factors.
“Values are going to go up, and they’re going to go up significantly,” said Ernest Del Guercio Sr., Appraisal Systems’ CEO. “But that doesn’t necessarily mean that assessments will go up, because the tax rate may also go down considerably.”
“Values are going to go up, and they’re going to go up significantly.” – Ernest Del Guercio Sr.
“What we’re doing is attempting to appraise the true market value of each property,” said Rick Del Guercio, Appraisal Systems’ president. “But it’s important to understand that a revaluation doesn’t generate new taxes; it simply redistributes existing taxes. If you think of it as a pie chart, what we’re trying to determine is everyone’s fair share.”
In New Jersey, especially in Hudson County, Del Guercio Sr. said, revaluations often have massive effects because they’re hardly ever done on a reasonable timetable.
“In Connecticut, municipalities are required to do a ‘reval’ every four years, and in New Jersey, some counties, like Essex and Bergen, are very good about doing them frequently,” he said. “In Hudson County, municipalities are very slow to order them.”
Local mayors tend to hold off on revals because they don’t want longtime residents’ taxes to go up in an election year. Plus, the process costs additional money. After past administrators failed to do a revaluation, it fell to Mayor Dawn Zimmer’s administration.
In Hoboken’s case, the New Jersey Division of Taxation ordered the county to decide which municipalities should revalue properties. The county ordered Hoboken to conduct the revaluation, said Del Guercio, but conducting the revaluation ahead of the November mayoral election was the city’s decision.
“A lot of times, wise politicians will leave them until after the election, because they’re not a very popular subject. It doesn’t mean it’s right; it just means it’s politically expedient,” said Del Guercio. “But I think it’s better to do it before an election because it prevents the revaluation itself from becoming too political.”
The ‘reval’ process
The Del Guercios, along with several other Appraisal Systems employees, explained the revaluation process, beginning with individual inspections that will start Monday and take place over the next three months. The process will end with the publication of the value of each and every property in town on their website in late November or early December.
On Monday, six to eight appraisers will begin knocking on doors unannounced between 9:30 a.m. and 5 p.m. in order to inspect each house. If a resident is not home at the time, a card will be left with Appraisal Systems’ contact information and the date and time at which an appraiser will visit next.
If a resident knows they will not be home at that time, they can call Appraisal Systems and reschedule for a more suitable time, including evenings from 5 p.m. to 7 p.m. and some Saturday mornings. However, if you fail to schedule a special inspection appointment and are not home when the appraiser comes the second time, there are consequences -- your property will be assessed at the highest possible value based on the values of neighboring properties.
Inspections will include an exterior and interior section, during which the appraiser will focus on number of floors, rooms, bathrooms, and the quality of the kitchen. Heating, central air conditioning and whether a home is equipped with a finished attic or basement will also be taken into account. The inspections are estimated to take five to 15 minutes.
Condos will be inspected similarly, the only difference being that the appraisers will base their assessments on master deeds, rather than individual unit inspections.
In early November, letters will be sent out to each property owner in Hoboken informing them of their new property value. Following this, each homeowner has the right to schedule a one-on-one meeting.
Afterwards, the final property values will be submitted to the city, and will be published on Appraisal Systems’ website. Once this information becomes public, you can search the value of any property in town, even that of your next door neighbor.
Residents have many questions
Following Appraisal Systems’ presentation, an hour-long question and answer segment was conducted, and residents questioned everything from the effects of Hurricane Sandy-related flood damage on property values to what types of supplemental information the appraisers would accept as part of their inspections.
“As appraisers, we literally will look at anything or everything you’ve got,” said Del Guercio. “We can’t say what will and will not have an effect, but we will certainly look at everything.”
For example, if a homeowner refinanced his or her home recently, the lender’s appraisal could be taken into account.
One resident, who said he was a longtime homeowner, asked if the fact that he is retired and has limited income would make a difference. Del Guercio replied that it would not.
Hurricane Sandy was a hot topic, with some residents realizing that they may be penalized for having done substantial repairs to their home following a flooding because their property value increased. Others, who said their repairs were currently underway, wondered if their property would be assessed mid-project or upon completion.
“Everything is going to be valued as of Oct. 1,” said Del Guercio. “Whatever the condition of your property is on that day, that’s what it will be assessed on.”
The city announced late on Friday that it will hold two sessions this Thursday at the Elks Lodge at 1005 Washington St. to give more information to residents on the upcoming reval, one at 10 a.m. for residents and one at 1 p.m. for businesses.
Dean DeChiaro may be reached at email@example.com