Many Montgomery County residents are facing higher property taxes this year, even as the value of their homes sags.
The bills sparked anger and confusion among many, who, in turn, blanketed county officials with questions about how their property taxes skyrocketed despite promises to the contrary.
“Montgomery County is greatly increasing property taxes, and this is especially hurtful to retired elderly persons living on fixed incomes,” Gaithersburg’s Lawrence Marsh wrote to county officials. “These folks deserve to enjoy their last ‘golden years’ without the harassment of [a] major tax increase.”
The exchange highlights the nature of Maryland’s property tax methods, which can be advantageous some years — but seem blatantly unfair in others.
Montgomery County officials did not, in fact, raise property tax rates this year.
Instead, homeowners can thank Maryland’s assessment system.
The state assesses home values every three years — with the increased burden spread over the period.
For example, if a property previously valued at $100,000 jumped to $160,000, the home would be assessed at $120,000 the first year, and $20,000 more during each of the next two years.
This year, homeowners who were assessed three years ago are paying taxes on their full valuations from 2007, the top of the housing bubble.
During the bubble, homeowners benefited with the system as house prices soared but their capped taxes did not.
But now, the market’s plunge has caused the opposite — homeowners are paying taxes based on values that are much higher than the homes’ worth.
For example, a house in Silver Spring will be paying taxes on a $403,000 assessment although houses in the neighborhood are being sold for the mid-$200,000s.
“My property taxes are ballooning,” an irate William Bowie, of Potomac, told The Washington Examiner. “It’s absurd. My house is worth a fraction of what it was. And yet, I’m paying like the opposite is happening. How does that make any sense?”
The higher property taxes are a sore spot for county residents, already feeling the pinch from roughly $250 in new taxes and lost services that once seemed routine in one of the nation’s wealthiest suburbs.
Northern Virginia counties primarily turned to higher property tax rates to fill their bare coffers during recent budget talks. But most residents will still pay less in property taxes this year thanks to declining home values.
In Montgomery County, the taxable value of a property cannot rise more than 10 percent in a given year, but that still does not limit any increase in the overall bill.
