Across Polk County, residents and businesses have noticed their property market values have generally been on the rise over the past few years. While this is great news for homeowners around the area, many wonder what that will mean for property taxes. Property taxes are based on property assessment values.
According to Polk County Assessor Mark Landsverk, the county’s assessment values are also on the rise due to increased sales and sale prices of residential, commercial, and agricultural property within the county. Landsverk noted this trend continued after the COVID-19 pandemic ended in 2021. “Whether it’s residential, commercial, or agricultural, we get information on all those sales. We take that information and determine whether they’re open market – arms-length sales between willing buyers and sellers – and we take them and see whether it shows if the market is going up, down, or sideways,” County Assessor Mark Landsverk explained. “In the past year, nationwide, they’ve gone up about 19% on residential properties, and this year, I haven’t seen the final results on that, but it appears locally that it’s going up just as much, if not more.” Landsverk reported that 2021 saw about 350 sales of residential properties in the county, with values increasing by 10- 15%. This year has had about 380 residential sales, plus 40 seasonal property sales.
While some homeowners have made additions or changes to their homes and property that caused the rise in their property values, properties with no improvements have also seen an equitable rise in value. Landsverk explained that events like this can happen when assessors check homes every five years and find something that can cause a property’s value to increase, or they may have found a new piece of information about the property with the transfer from paper to computers.
While property values are increasing substantially across the counties for residents and agricultural properties, Landsverk noticed that increases on commercial property values are lagging the other two types due to a lack of sales. “Commercial properties haven’t been going up as much as residential properties. Last year in Polk County, we didn’t have as many sales, we had nine commercial sales in Crookston and East Grand Forks on commercial property, and our values were very close, so we didn’t have to make much of a change there. Same thing in the small-town commercial area, we had eight sales, and we’re pretty much right on for most of those,” Mark Landsverk explained. “This year, it looks like we may have to go up a little bit more in the cities, there are six sales, all in Crookston, and we’re a little low there, but throughout the county, we’ve had seven sales, and we’re very close on that as well. So, it hasn’t affected commercial as much as residential or seasonal recreational, and now it is also showing up in Ag.”
The county is also preparing to lower its current preliminary levy from just over a 5% increase to a 3.5% increase from 2022 at an upcoming Public Budget Hearing on Tuesday, December 13. Landsverk noted that the lowered levy could contribute to further changes in some property values as the new lower tax rate may cause property owners to negotiate new sale prices. “Whether the tax levy change goes down and makes any difference on the values, the answer is it depends on how the people who are buying and selling property foresee it,” Mark Landsverk explained. “Whenever a property is sold, we get that information and record it, and then we see where our market is headed, and that’s where we apply that information, so, whatever the perception is for the public is where that market will go.” Landsverk explained that if the public sees that economic conditions are not conducive to increasing values, they’ll try to negotiate the sale prices down, and if enough of them go down, the market can plateau and eventually begin to drop. He noted that the price decline would also require property owners to accept lower prices on the sale.
The Crookston School District will hold its Truth-In-Taxation hearing on Monday, December 12, at 6 p.m. at Crookston High School to review the final levy, and the Polk County Commissioner’s Truth-In-Taxation hearing will be held on Tuesday, December 13, at 6 p.m. at the Polk County Government Center.
