Menu

Maryland Property Tax Updates

UPDATED September 2017

Tax Rates and Tax Bills

The Counties and Incorporated Cities have all sent their tax bills that are due by the end of September. Some jurisdictions allow for two payments in September and December which is notes on the tax bills. While we saw a 2% decrease in the tax rate in Montgomery County for this tax year, this came after several years of tax rate increases. Therefore, for budgeting purposes, we recommend being conservative with future year tax rates.

Make sure that the tax bills are paid by September 30th to avoid steep penalties and interest.

Emily K. Betsill, Esq
Wilkes Artis, Chtd.
American Property Tax Counsel (APTC)

Maryland Property Tax Update Archive

UPDATED JULY 2017

Maryland Legislative Update

In May, Governor Hogan signed three bills impacting property tax appeals in Maryland:

First, Property Tax Assessment Appeals Boards are now required to schedule hearings on residential dwellings within 120 days. Wilkes Artis is monitoring this change and working with the clerks to ensure that hearings for commercial properties are still scheduled in a timely fashion.

Second, counties are now required to issue a refund within 30 days of receiving notice of a reduction. This is a relief to taxpayers in some counties that have been waiting 90 days or longer for refunds.

Third, assessors must now consider the reason for a prior reduction when preparing a subsequent assessment. The assessor may not “eliminate a reduction” if the reason for the prior reduction still applies. The impact of this legislation may be limited in practice but it does provide a statutory basis to protect taxpayers from having to relitigate issues already decided by a Board or the Tax Court.

Rhett C. Tatum, Esq.
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

 

UPDATED MARCH 2017

2017 Reassessment Trends & 2018 Income and Expense Filings

The 2017 Levy Year assessments are out and data collected by Wilkes Artis indicates an average increase of 21% for commercial properties in Maryland. This cycle included the reassessment of the Bethesda and Chevy Chase submarket. Assessment increases for office buildings in this submarket were in line with the statewide trend, averaging 18.8%.

Starting this summer, Maryland will begin work on the 2018 reassessments which will include the I-270 and Rockville Pike corridors in Montgomery County and the Lanham and Landover submarkets of Prince George’s County. In Baltimore City properties in the Fells Point and Canton neighborhoods will be reassessed, as will properties south and west of the Inner Harbor. Income and expense filings for properties being reassessed and valued at $5,000,000 or more are due by June 15th or owners could be subject to a late filing penalty.

Rhett Tatum, Esquire
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

 

Updated December 2016

Bethesda Downtown Plan and Reassessments

The Montgomery County Planning Board has completed the Bethesda Downtown Plan and is now in the review stages of the revision to the zoning plan for Bethesda, Maryland. The plan has not been updated in almost two decades and may add additional density to some sites within the Downtown Bethesda area. Real Property assessments for Bethesda will be issued on January 1, 2017 for tax years 2017, 2018 and 2019. Given the new potential density in the area, the State may increase land values in Bethesda to reflect the likely changes in the Downtown Plan. Taxpayers should pay particular attention to changes in their real estate tax assessments for this area of Montgomery County in the coming month. The deadline to appeal real property assessments issued on January 1, 2017 will be on or about February 10, 2017.

Emily K. Betsill, Esquire
Wilkes Artis, Chartered 
American Property Tax Counsel (APTC)

 

Updated September 2016

Montgomery County Refunds and 2017 Out of Cycle Appeals

Refunds: Frustrated that property tax refunds in Montgomery County often take over 90 days to issues, Wilkes Artis has been working with the Department of Finance to streamline the process. Faster refunds will reduce cash flow management problems for taxpayers and save the County from unnecessarily paying interest.

2017 Petition for Review Reminder: Even if your Maryland property is not scheduled for reassessment in 2017 you can still file a Petition for Review if changes over the last year have significantly reduced the value of your property. The Petition must be filed by the end of the year.

Emily K. Betsill, Esquire
Wilkes Artis, Chartered 
American Property Tax Counsel (APTC)

 

Updated June 2016

Budget Concerns Lead To Property Tax Rate Hikes

Counties continue to struggle with budget woes, we are beginning to see significant increases in real property tax rates. Prince George's County Council approved a 4% increase in the county real property tax rate for Tax Year 2015, and Montgomery County Council just approved an almost 4% increase in the real property tax rate for Tax Year 2016.

In addition to real property tax rate increases, many counties have explored increasing recordation and transfer taxes in addition to increases in real property taxes. The Montgomery County Council recently voted to increase recordation taxes almost 50% to $2.30/$500 of purchase price. This increase will impact many upcoming transfers.

As counties continue to struggle with their bottom line, more increases in property and transfer/recordation taxes are possible in the coming years.

Emily K. Betsill, Esquire
Wilkes Artis, Chartered 
American Property Tax Counsel (APTC)

 

Updated March 2016

Maryland Releases 2016 Assessments

Despite poor market fundamentals in many parts of suburban Maryland, commercial assessments in the State continued to increase significantly with the January 1, 2016 reassessment. Statewide, proposed assessments on commercial properties represented by Wilkes Artis were an average of 21% higher than their previous values. The focus of this year’s reassessment in Montgomery County was the Silver Spring area. Countywide assessments increased an average of 27%, with large increases seen in the Silver Spring/Wheaton submarket. Greenbelt, the largest cluster of office space in Prince George’s County, was also reassessed as of January 1, 2016. Although increases in Greenbelt were not as substantial as they have been in prior cycles, assessments still rose despite a general decline in building market value. Vacancy remains high and both face and net effective rents continue to decline. Countywide, Prince George’s assessments increased an average of 17%.

Emily K. Betsill, Esquire
Wilkes Artis, Chartered 
American Property Tax Counsel (APTC)

 

Updated December 2015

Recent Court Decisions Affirm Accepted Hotel Valuation Methodology in Maryland

In back-to-back trials, the Maryland Tax Court ruled almost entirely in favor of the tax payer in two cases challenging hotel assessments. The State Department of Assessment and Taxation had refused to properly account for FF&E, reserves and necessary capital costs. By ignoring key elements of the methodology long accepted by the Court, the State effectively taxed hotel owners twice on the value of their personal property. Additionally, the State ignored both reserves and capital costs necessary to maintain a stabilized ADR. Although not published, these decisions further clarified the Court’s position on the proper implementation of the Rushmore methodology.

Emily K. Betsill, Esquire
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

 

Updated March 2015

Surburban Maryland Real Estate Tax Assessments See Dramatic Increases in 2015

The 2015 reassessment period saw significant increases in real estate tax assessments in Montgomery and Prince George’s Counties, despite negative absorption in the Class B and C office markets in Suburban Maryland. On average, commercial assessments increased approximately 20% in Prince George’s County and 50% or more (in some cases more than 100%) in Montgomery County. These increases appear to be due in large part to the use of below market capitalization rates and above-market rental rates in suburban markets that are currently experiencing high vacancies and rent compression.

Emily Betsill, Esquire
Wilkes Artis, Chartered
American Property Tax Counsel (APTC)

 

Updated December 2012

Uneven Real Estate Recovery Continues in Maryland

Uneven economic recovery throughout the Maryland real estate market, reported in the March 2012 , continues, showing variation by county and property type. Though apartment properties continue to perform relatively well, the rate of apartment buying has slowed, particularly in the Class A market. Total return on apartment investments in the Washington, DC area, as reported by the National Council of Real Estate Investment Fiduciaries, remains solid, though it has declined significantly from its peak in 2010. Cap rates for this type of property have remained relatively low. Notably, the Class B investment market is expected to surpass its 2011 sales volume. Industrial properties in Maryland have continued to not perform as strongly as apartment properties, with vacancy rates remaining high. With respect to office properties, downtown Bethesda and Rockville continue to lead the suburban Maryland real estate market in terms of sales and new construction. Budget deficits posted by some Maryland counties, including Montgomery County, continue to encourage new ways to increase revenue. Higher tax rates as a means to bridge budget shortfalls remain a very real possibility.

Kevin E. Kozlowski
Wilkes Artis, Chtd. 
American Property Tax Counsel (APTC)

 

Updated March 2012

Real Estate Recovery Varies by County and Property Type

While examples of the economic recovery can be seen throughout the Maryland real estate market, the recovery tends to vary by both county and property type. Apartment properties have been performing relatively well across the board. With interest rates declining, so too have cap rates fallen for this property type. Industrial properties have not performed as strongly. In Prince George's County, vacancy rates for this property type hovered close to 10% throughout 2011. For office properties, Montgomery County saw some of the highest sales since the start of the economic downturn, with several trades topping $400/sf in suburban CBDs. With regard to taxes and assessments, budget deficits continue to encourage counties to find ways of increasing revenue. While assessments have not increased dramatically in most instances, some counties, such as Montgomery, are entertaining proposals to increase tax rates in order to help bridge budget shortfalls.

Eric S. Kassoff
Wilkes Artis, Chtd.
American Property Tax Counsel (APTC)

 

Updated September 2007

2007 Decisions and Second Level Appeals

2007 Levy Year Appeals: Initial appeals of the 2007 Levy Year assessments are underway before the State Department of Assessments and Taxation (SDAT) for the first level of administrative review in Maryland. The assessor's determination is not the final word however. Property owners unsatisfied with the SDAT decision have 30 days from the date on the final notice to bring a second level appeal before the Property Tax Assessment Appeals Board. These 3-member independent Board hearings present another opportunity to present the merits justifying a reduced assessment.

2008 Levy Year Assessments – Time to Prepare: In January 2008, another 1/3 of all property in Maryland will be reassessed. Properties assessed at $5 million or more in the last levy cycle were required to submit income and expense data for 2004-2006 to the SDAT by June 15 th else face statutory penalties of $100 per day. This is also a great time to verify your contact information with the State. Check out the information on file with the State at: www.dat.state.md.us

Maine Property Tax Updates
Massachusetts Property Tax Updates

American Property Tax Counsel

btn cofollow badge
follow-twitter
aptcnet facebook

Recent Published Property Tax Articles

RETAIL SUFFERS FROM EXCESSIVE TAX ASSESSMENTS Assessors attempt to ignore market realities when valuing retail property.

Retail property owners' pursuit of fair treatment in real estate taxation seems to generate a river of appeals and counter-appeals each year. What makes this ongoing melee especially perplexing and frus­trating for property owners is a sense that taxing entities will often ignore market realities and established valu­ation practices to...

Read more

Struggling with Vacancy? You May Get a Break on Property Taxes

To determine whether your property may qualify for relief, identify the market occupancy rate for that property type and submarket.

In many states, abnormally high vacancy at commercial properties should mean a lower tax bill. Market transaction evidence essentially dictates this result: States that assess taxable value on commercial properties...

Read more

Oregon Law Offers Potential For Property Tax Reductions

Properties under construction and projects subject to governmental restriction can take advantage of legislative provisions the state provides.

The Portland metropolitan area is undergoing an unprecedented boom in commercial construction that extends from downtown to the suburbs and into just about every product type.Many taxpayers are preparing to pay larger tax...

Read more

Member Spotlight

Members

Forgot your password? / Forgot your username?