1. Why are assessments determined annually?
In accordance with the Code of The City of Charlottesville all real estate shall be assessed annually. The assessments are effective January 1 of each year. Change of assessment notices are mailed annually at the end of January.
2. Why does Charlottesville Assess at Fair Market Value?
The Constitution of Virginia, Article X, Section 2 and the Code of Virginia, § 58.1-3201 require real estate assessments to represent fair market value.
3. What is Fair Market Value?
Market value is defined as the most probable price expressed in terms of money that a property would bring if exposed for sale on the open market. The sale should be an arms-length transaction between a willing seller and a willing buyer, both of whom are knowledgeable concerning all the uses to which the property is adapted and for which it is capable of being used.
4. How does the Assessor's Office obtain information on properties?
The appraisal staff inspects properties and gathers information that is pertinent to value: type and quality of construction, square footage, type of heat, baths, fireplaces, location, etc. This information is maintained and kept on file in the Assessor's Office. The information is a matter of public record and may be reviewed at any time.
5. How are property values determined?
Most residential properties are appraised by the market approach. In this approach, the value is determined by comparing similar properties of the same type and class which have sold recently in the same neighborhood, taking into consideration factors which may affect value, such as location, condition, size, etc. Recent sales in your neighborhood are a key factor in what your assessment will be. Sale types can vary, e.g., valid or invalid, and also play a role in determining the assessed value. A valid sale is also referred to as an arms-length transaction. In short, an arms-length sale refers to a sale between a willing seller and a willing buyer. Each time a property sells the Assessor's Office mails a questionnaire to the buyer asking questions about the sale to help determine if the sale was valid or invalid. The majority of sales in the City are considered arms-length sales. Some examples of sales that would not be considered arms-length include bank foreclosures, auctions, sales between family members, and condemnations.
Most commercial properties are appraised utilizing the income approach, which capitalizes the property’s income into an estimate of value. The income approach looks at the ability of the property to earn income through rents while considering operating expenses and allowing for vacancy and other losses. The resulting net operating income is capitalized at an appropriate rate to achieve a fair market value estimate. Market sales of commercial properties are also used to help determine the final assessed value.
6. What if there are no recent sales on a certain street or block?
If there are no recent sales in a certain area, sales from comparable areas are reviewed to help determine values. These areas are similar in location, price range and style of homes. This situation rarely occurs due to the number of properties that sell each year in the city.
7. Why do assessments change from year to year?
When the market values in your neighborhood change, so does the assessed value. For instance, if homes in your area are selling at prices above their assessed values the assessments will likely increase. However, if homes in your area are selling below their assessed values they will likely decrease.
8. Why are some properties assessed higher or lower than what they sell for?
The appraiser does not get the opportunity to go into every home when assessments are made. Therefore, most assessments are based on exterior inspections. The appraiser tries to monitor each property so that assessments are fair and equitable and not in excess of market value. If the appraiser finds that an assessment is too low or too high they will make adjustments as needed.
9. How does a property owner appeal an assessment?
Each year, all property owners, or their duly-authorized agent, may appeal our valuation of their property by requesting a review of their assessment. Under state law, neither financial impact nor the rate of value change is, by itself, sufficient grounds for appeal. As required, the City's assessment is an estimate of fair market value as of January 1 each year, based on property sales for the previous calendar year. We welcome appeals based on issues of factual discrepancies in property description or features, demonstrable issues of uniformity of value within a neighborhood, or fair market value.
The first step in this process is to file an Assessment Appeal Application, requesting an assessor review. The Assessment Appeal Application form (PDF) can be downloaded by clicking here, in the City Assessor's office located at 102 5th Street NE, or at the Central Library located at 201 E. Market Street. You may initiate your request by filling out and mailing the form to: City Assessor's Office, 102 5th Street NE, PO Box 911, Charlottesville, VA 22902. You may also stop by the City Assessor's Office located at 102 5th Street NE to drop off the form in person.
Your appeal for a review of your assessment must be filed after January 30th , 2020 and delivered to our office by one of the above means on or before February 29, 2020. Appeals should be made in writing, including the City's Assessment Appeal Application, a Letter of Authorization if the appeal is being made by an owner's agent, and any other supporting documentation that is appropriate. This documentation must include the reasoning behind the appeal and evidence that the most recent assessment (1) exceeds true market value, (2) is substantially inequitable to similar properties within your neighborhood, or (3) is not equitable based on factual discrepancies within our records, such as difference in square footage, difference in acreage, or improvement condition.
After your appeal application has been received, the assessor who valued your property will meet with you to review your property's assessed value. This meeting may include a visit to your property for a physical inspection. Following this, the assessor will determine what change, if any, is appropriate. Notice of his decision will be provided to you within 30 days by mail. If you agree with the assessor's decision, you will not need to take any further action. However, if you disagree with the assessor's decision, you may proceed to the next step in the appeal process.
The second step, if required, is to request a review of the property's assessed value by the Board of Equalization (BOE). The BOE is an independent panel of citizens, appointed to mediate when the property owner does not agree with the assessor's decision in the first part of the appeals process. BOE hearings are scheduled within 30 days after the City Assessor's Office receives a request for further review from the property owner. The property owner's appeal application is provided to the BOE with any written evidence that demonstrates that the property's value is inconsistent with similar properties, is assessed above or below fair market value, or is inconsistent with the physical features of the property.
Following their hearing and review of the appeal packet, the BOE will provide the property owner with their decision by mail within 30 days. At this point, any property owner who disagrees with the BOE decision regarding the assessed value of their property has the right to escalate their appeal to the Circuit Court.
The third and last step, if necessary, is to take your assessment appeal to the Circuit Court. At this point, the burden of proof falls entirely on the property owner. You will be required to provide evidence to the Court that substantiates your contention that the assessed value of your property is inequitable based on fair market value, the assessed value of comparable properties, or factual discrepancies with the City Assessor's records. You will also be required to pay all associated court costs. Once the Circuit Court issues its decision, all parties are obligated to adhere to its findings and the appeal process ends.
10. How is the tax rate determined?
The tax rate is set by City Council in the spring of each year. The formula to calculate your taxes is as follows:
Assessment divided by 100 X Tax Rate = Annual Taxes
Ex) Real Estate valued at $100,000 the annual taxes are calculated as follows:
$100,000/100 = $1,000 x $.95 = $950.00
The semi-annual tax bill is calculated by dividing annual taxes by 2: $950/2 = $450
The tax rate is currently $.95 per $100. City taxes are paid twice a year to the City Treasurer's Office on June 5 and December 5, respectively.
11. What is the City's Real Estate Tax Abatement program?
Some home renovations or additions may qualify for a real estate tax exemption. The requirements to qualify for the program are listed below (Year 2020):
- Structure must be at least 25 years old.
- Total assessment cannot exceed $666,200.
- Must be owner-occupied, single-family residential (attached/detached accessory apt. allowed as defined by NDS).
- Additions and/or renovations must add at least 15% in value to the property's improvements as determined by the City Assessor's Office.
- Must have filed for building permit prior to abatement application.
- Application must be filed before any demolition or construction begins.
- At the time of application, Assessor's Office must inspect property before and after construction.
- Improvements must comply with all building and zoning regulations.
- If approved, tax exemption will run for a period of seven (7) years, or as long as the property is owner-occupied, whichever is less.
- If a property is sold, abatement is transferable as long as the above requirements are maintained.
- Applicant pays a nonrefundable filing fee of $50.
Applications are available from the City Assessor's Office.
12. Does the City offer any other programs for financial assistance?
The City of Charlottesville offers several programs that residents are encouraged to apply for. These programs are administered by the Commissioner of Revenue's Office. Please contact the Charlottesville Commissioner of Revenue’s Office at 434-970-3160 for assistance.
13. What is the Stormwater Utility Fee?
The stormwater utility fee is managed under the City's Department of Public Works as a component of the Water Resources Protection Program and is unrelated to the assessment of real property. Please contact the Stormwater Utility Administrator for any questions related to the stormwater utility fee at 434.970.3876. Click here to view a brief summary on how the stormwater utility fee is calculated.