The value of real estate in Hanover County will see its largest year-over-year increase in the past decade when 2019 arrives.
According to the assessor’s office, the reassessment of 37,000 properties and new construction will increase the value of the county’s total taxable property by $856.6 million, or 6.1 percent.
Richard W. Paul, the county’s director of real estate assessments, said most property owners will pay a larger tax bill next year.
“A majority of them are going to see assessment increases,” Paul said in an interview after a presentation to the Hanover County Board of Supervisors on Wednesday.
Unlike some other localities, Hanover has traditionally not calculated what the average change in assessment will be for residential or commercial properties, as the value of individual properties can vary greatly depending on location, land improvements and potential use of the land.
According to his presentation, the value of residential property assessments increased by $628.9 million, or 5.5 percent, and commercial assessments rose by $59.6 million, or 2.1 percent.
The median assessment of a Hanover County home will be $277,700, an increase of 7.7 percent over the current year.
In addition to the reassessments, new construction this year has added $168 million in real estate value for the county.
With 130 fewer building permits issued this year, the added value is about $32 million less than what was added to the tax base in three of the past four years.
Real estate values in Hanover have increased steadily since 2014, after a four-year slump that began in 2010. Thanks to the 6.1 percent growth, total land value in the county next year will surpass the $15 trillion mark.
“The market has done well in the last year,” Paul said. “We have low unemployment, it’s a seller’s market, [and] we have low inventory. All of those things lead toward increases in real estate values.”
“From the [sales] prices we see, I’m not at all surprised that a majority of homeowners will see an increase in their assessment,” said Richmond Association of Realtors CEO Laura Lafayette.
According to the assessor’s office, there have been a total of 1,677 home sales this year — 775 of which were sold for more than $300,000.
With new homes selling at an average of $387,300, up by nearly 10 percent from last year, the median sales price stands at $292,700.
While larger tax bills could pose a challenge for some , especially those on fixed incomes, Lafayette said it’s not all bad news.
“I always reiterate to homeowners that a strengthened equity position almost always far outpaces whatever increase your real estate bill might be,” she said.
The assessor’s office will accept inquiries and informal assessment appeals through January. Formal written appeals to the Board of Equalization are due March 15.