Property Tax Town Hall Draws Curious Homeowners

When it comes to understanding the value of your home, don't look at what you paid to buy it; look at comparative house sales in your neighborhood. It's the first step in figuring out if your property taxes are too high. That's just one piece of advice offered by realtor Mark Avery during a town hall meeting on Saturday at .

On Saturday, he stood before about 30 people -- most from Plymouth and Northville townships -- explaining the true value of a home and how owners of private homes or commercial properties can challenge annual taxes they pay.

“You have to challenge because the numbers aren’t real,” he said, while flipping through slides to illustrate each point and telling stories about his experience as a realtor and as a property owner.

Avery offered a disclaimer early on that he was not dispensing legal advice. He said the legal information reflected on the slides has been created one of his former real estate legal advisors, attorney Mike Bosnic, who has gone on to be Oakland County's 19th District commissioner, representing Troy and Clawson.

Avery said later that he has led about 130 workshops like Saturday’s over the last three years earlier this week he was in Canton. He said the most important thing people need to do is understand the appeal process, keep good records and meet deadlines.

20th District State , R-Plymouth, sponsored the forum. He represents an area, which includes the cities of Northville and Plymouth as well as the townships of Canton, Plymouth and Northville.

The formula for calculating proper taxes, Avery said, is the taxable value of home, multiplied by two. (As an example, a home with a taxable value of $50,000 would be considered worth $100,000.)

“If your house is worth less than the taxable value times two, you are overtaxed,” Avery said. “If a property is residential or agricultural, you have to go to the board of review (to challenge a tax rate). If the property is commercial, you may bypass the board of review and appeal directly to the Michigan Tax Tribunal.”

The one reason no one should use when challenging a rate, he said, is “My taxes are too high. That’s not a reason for protest.”

The proper protest reason, he said, is that the assessed value is more than 50 percent of the true cash value of property. He said a home with an assessed value of $100,000 and cash value is 150,000 would mean the property owner would pay too much in taxes, because the assessed value should be $75,000.

His advice for homeowners:

• Get educated. Know the assessed value, taxable value and state equalized value (either from your municipality or check the form mailed to you each year from your city or township. Taxable value is typically equal to or lower than the state equalized value.
• Set up a good record-keeping system for your research.
• Be prepared to learn that you are not, in fact, being overtaxed.
• If you do find evidence that your property taxes are too high, you can only appeal them once a year, typically in March. (In other words, act swiftly.)
• Visit your city or township’s assessor’s office and ask to see the description used for the assessment. The form is typically called a field card. Avery said after buying a two-bedroom, one-bathroom, 732 sq. ft. home in Royal Oak, he checked the field card and found the home had been described as a three-bedroom, two-bathroom home.
• In compiling your appeal to the tax review board, check comparative home sales – but don’t include bank-owned, short sales or foreclosures, because those don’t count toward market evaluations, he said.
• If you own a condominium, look at private sale for similar properties as well as traditional residential homes. “Condos are getting killed,” he said, because typical value comparisons lump condominiums in with regular home sales.
• The law, Avery said, prevents a home’s value from being increased or decreased based on a particular condition. “If your roof is in terrible condition, they can’t lower your assessment. If you put on a new roof, they can’t raise your value,” he said. The value of a house is not based on a purchase price, Avery said, “you have to look at the value of properties around your house.”
• If you can’t be present during the window for making appeals, write a letter and include copies of all the justification for your request. Make two copies of the communication, and have each one time-stamped, to prove that it is delivered on time.
• If you want to send someone to represent you at a tax board of review hearing, you must provide a letter of authorization for that person.
• If you represent yourself at a tax board of review hearing, you should bring a copy of your presentation for each member of the panel (typically three, but sometimes five) as well as a copy for yourself and an extra for the assessor.
• Be nice. “I mean, these people are getting barraged by very angry people, especially in the last couple of years. There’s no reason for you to go in and be belligerent. They are hired to do a job. Humans make mistakes sometimes.”
• Be patient. Avery said challenges to 2009 taxes are currently being reviewed at the state level and though the panel can clear 600 per week, there is a backlog of about 100,000 cases.
• If your request is rejected at the local level, you can appeal to the state.
• Pay your taxes throughout the process. Avery said the appeal process can take as many as seven years and “you have to keep paying your taxes or you lose. If you keep paying, you may get a refund,” he said, adding that the refund would cover each year starting from when the property owner started the review process.

Mark and Margaret Oswald of Northville Township were in Avery’s audience. Mark Oswald said they attended after learning they paid too much for their home last summer. After Saturday’s session, he said, “We’re going to be appealing our taxes.”

Diane Talik of Plymouth Township said she has appealed taxes for her mother, 92, in 2009 and plans to appeal again this year because values have fallen. She said Avery confirmed what she's learned and expanded her knowledge.

“It started out as $225,000 in value and in 2009, I found out the house was only valued at $180,000,” she said. “Now, the values are closer to $127,000, so I’m appealing again. … I feel bad about doing it, because I know the township needs the money. If we were rich, I wouldn’t care.”

Former Plymouth Township trustee and 20th District State Rep. Jerry Vorva attended the meeting to recruit people to join his effort to force the state to allow tax appeals throughout the year. He said elderly people miss out on appeals when they travel out of state.

Vorva asked Heise Saturday about expanding the appeals time and Heise said it sounded like a good idea. After the forum, Vorva said he wouldn’t wait for the state legislature to act; he said he plans to file a suit against the state in about two weeks to demand the change.

Plymouth Township Supervisor Richard Reaume, who also attended the session, invited his township's residents to visit the assessor's office to get the necessary information needed for a property tax challenge.

Editor's note: This story has been corrected to accurately reflect the number of times Diane Talik of Plymouth Township has appeal her mother's property tax rate.