As in the Sarasota property tax article I posted last month, this post analyzes the change in the Property Appraiser-determined Just Values (market values before any exemptions or Save Our Homes cap) between 2015 and 2016 (latest available data). The Property Appraiser equates Just Value with market value. Since the valuations are always AS OF January 1 of the tax year, the change in value discussed relates to calendar year 2015 (the change in value that occurred between January 1, 2015 and January 1, 2016). The 2017 valuation should be finalized later this year.
Also in the Sarasota post, I characterized the Property Appraisers valuation as good as any I could have derived, at least in a reasonable amount of time. The Florida PA offices revalue every property every year using a mass evaluation technique. The process is to assign a value to large sections of land and then use statistical techniques to allocate that value across individual parcels with each section. At first, the methodology sounds rough, especially compared to the typical Realtor® market analysis approach, where recent sales are analyzed and adjusted based on differences between the homes being sold and the subject property. Furthermore, the big swings in appreciation rates between buildings and across years in the schedule below cast doubt on the validity of using the Property Appraiser’s valuations for anything other than coming up with a tax bill.
However, consider that many condominium communities on Longboat don’t have a sale every year. In fact, of the 92 communities listed on the schedule below, only 70 had sales in 2016. This means, for over 23% of the buildings, anyone appraising for any purpose would have to rely exclusively on sales in the surrounding area – much like what the PA office does. So wild swings or not, the PA calculations may be the best.
Whether the tax Just Value derived from the Property Appraisers’ approach is anywhere near the real market value is anyone’s guess. The same thing also can be said about the Standard & Poors/Case-Shiller numbers, generally the basis for all media reports of appreciation and taken as fact. They both are the result an estimation process.
In summary, the County PA offices figures (Just Value) are what I summarized below. I refer to the changes in value as appreciation as though it was a certifiable fact. You can make your own decision about the validity of calling this market appreciation. All references I make about appreciation here will be the year-over-year changes in Just Value.
Summary of Property Tax Just Value changes Longboat Key
The overall level of appreciation on Longboat Key condominiums during 2015 was 4.8%, down slightly from the 5.9% in 2014. Buildings on the west side of Gulf of Mexico Drive increased 5.2%, while those on the east side increased 3.7%. The Manatee end of the Key increased 8.6%, while the Sarasota end increased only 3.8%.
Other notes on the rate of change:
- Condominiums in Bay Isles increased 3.6% or .8% better than other bayside communities on the Sarasota end.
- Island-side condominiums in Longboat Key Club increased 2.2%, just a little more than half the average rate of all Sarasota-end communities on the west side of GOM.
- The 2 age restricted communities changed as follows:
- Case del Mar 8.3% or .5% points less than the average Manatee County west-side-of-GOM average.
- Spanish Main 11.9% or about 4% points above the average Manatee County east-side –of-GOM average.
Percentage Change in Longboat Key Taxable Values by Condominium Building
This is the schedule I was referencing in the opening paragraph, regarding the variations between buildings and years. Some of the swings are hard to believe. Look at Harbour Links as an example. In 2014, Just Values increased 56%, on average, in that community. The next year, they dropped 11%. It is hard to believe the market works this way.
But it could. The only sale in Harbour Links during 2014 was for $425k, which worked out to $241/ft. The Just Value of this property on 1/1/2014 was $335k or $140/ft. The new valuation on 1/1/2015 came in at $596k or a 78% increase in Just Value.
To recap the history of this property:
1/1/2014 – Just Value is set at $317k ($132/ft)
6/19/2014 – sells for $425k ($177/ft)
1/1/2015 – Just value is set at $596k ($249/ft)
On the surface, it looks like the PA overshot the value. I am sure the new owner thought the same.
However, the next year (2015) saw 2 residences sell in Harbour Links for $576k and $528 ($241/ft and $334/ft), a range that makes the 1/1/2015 Just Value of $596/$249/ft for the 2014-sold-home seem more reasonable (effectively saying the buyer got a great deal).