It is no secret that the real estate values in Northeastern Ohio have fallen with little hope for recovery in 2009. Both the commercial and residential real estate markets are suffering from the credit crunch, increased foreclosures and the recession. Although times are tough in the real estate industry, the one bright spot for property owners is the possibility of reducing their real estate taxes. Property owners in Cuyahoga County who believe their property’s value is lower than the current value maintained by the County Auditor may request a reduction in value by filing a complaint with the Board of Revision. The procedure for filing a complaint is somewhat different for commercial and residential properties and it varies by County.
In a residential challenge, the complaint should be supported by evidence of comparable sales in the area, which demonstrate that the property value should be lower than the value maintained by the Auditor. After a complaint is filed in a residential challenge, the Board will either set a hearing or make a unilateral ruling, depending on whether the Board has enough information to make such a ruling. In contrast, commercial challenges usually involve an appraisal that is performed by a licensed professional. The appraisal is submitted with the complaint and it provides the Board with a detailed explanation of the reasons supporting a reduction. After the complaint is filed in a commercial challenge, the Board will set a hearing. At the hearing, the property owner, the attorney and the defendant (typically the school board for the city where the property is located) will each have an opportunity to present testimony regarding their respective positions. The appraiser may also be present and provide expert testimony where appropriate. If the property owner successfully receives a reduction in value, the owner will receive a credit for taxes already paid and a lower value moving forward for future tax calculations.
In Ohio, real estate taxes are paid in arrears. For example, property owners pay the real estate taxes for the first half of 2008 in January 2009 and the real estate taxes for the second half of 2008 in June 2009. Keep in mind that a property owner may only challenge the Auditor’s value once every three years. The current three year period for challenges expires on March 31, 2009 and a new three year period begins January 1, 2010. Thus, the Auditor will perform a re-appraisal of all properties in the county during the summer of 2009 and property owners will have three years to contest the new value assigned to their property beginning on January 1, 2010. Again, other counties will have somewhat different procedures.
Many property owners are intimated by the real estate tax appeal process. If property owners do their homework and hire experienced professionals, their savings could be substantial.
Please contact the real estate practices group at Reminger Co., L.P.A. if you believe your property is overvalued given the state of the current real estate market. Our firm would be happy to assist you in filing a complaint for a reduction in property value. The deadline for filing complaints with the Board of Revisions for the 2008 tax year is March 31, 2009.