by Janell Arant
Janell Arant is a REALTOR® for West and Main Homes in Colorado and a former Residential Appraiser for Douglas County Government.
Nearly four months ago, Homeowners were hit with their new property valuations.
Jaws dropped and it was as if one collective scream could be heard across the land, followed by loud thumps (from the fainting, of course). Homeowners were left in disbelief at how their property value could increase by that much in such a short period of time!
One Homeowner in Cherry Hills received an increase of 80% and called the local news to tell their story. As for myself in Castle Rock – a 62% increase with appeals to follow. However, most Property owners across the state were in the median range of 30-45% value increases.
It was the talk of the town. The pitchforks and torches might as well have come out because the Assessor’s offices were quickly buried in appeals within days. It was unlike anything they had ever seen and even their estimates of what was to come were far surpassed.
Denver County Assessor, Keith Erffmeyer, stated they received 24,769 appeals. Douglas County Residential Appraiser Supervisor, Becky Fischer, reported 31,800 appeals. To put this into perspective, during the last 2021 reappraisal season, the Douglas County Assessor’s office reviewed 2,066 residential appeals. If you combined their 2021, 2019, 2017, and 2015 Assessor level appeals, you would have 13,969 appeals – still not even half of what they just experienced! As a former Residential Appraiser for Douglas County, I can tell you firsthand how extraordinary of a task that was! Hat’s off to our Assessor’s offices!
But it’s not over for them – that was just the first level of appeals! It’s CBOE time! But first, let’s quickly recap why this reappraisal season was so different from the rest...
The Party Nobody Asked For
Remember a few years ago: We were in the midst of a pandemic and interest rates hit a record low rate, sending Homebuyers out into a frenzied piranha-tank-style housing market. There were so many Buyers there weren’t enough homes to go around. Just to get their offers accepted, Buyers had to pull out all the stops and pay far more than what the home was listed at. These higher sales prices then set the bar for the next Seller on the street to set their list price at and, once again, to get the offer accepted, Buyers went even higher than the bar. What we thought was a short-lived anomaly became “Market Value,” what Buyers are willing to pay, and is the analysis approach Appraisers often use to determine residential home values.
It was right when home prices reached their peak in May/June 2022 that the Assessor’s offices were wrapping up the sales study period and using that data to develop their mass appraisal model to assign property values for the 2023 reappraisal. The timing was a total coincidence, bound by state statute, and unfortunately unavoidable. It was the perfect storm!
Since the peak, interest rates have continued to skyrocket, causing Property owners to stay in their homes longer than anticipated, further compounding the housing inventory crisis. It’s like the crowd came to see what all the fun was about, the cops showed up, the music came to a screeching halt, and Homeowners were left cleaning up a mess after a party they reluctantly participated in or didn’t even participate in at all.
Where Are We Now?
Fast forward to today where Homeowners who appealed their property value at the Assessor level are receiving their Notice of Determination’s – Adjusted or Denied? Erffmeyer of Denver County reported that just over 44% of appeals were adjusted. Fischer of Douglas County reported 41% adjusted.
There’s some relief in sight for the many who received an adjustment. However, some Property owners, like me, received a small adjustment but it’s just not enough. Or for those who were denied, they may be left frustrated or thinking there’s nothing more they can do. Fortunately, unsatisfied Homeowners can continue onto CBOE.
What is CBOE?
The County Board of Equalization (CBOE) is the second level of appeals, following the Assessor level of appeals. Like the Assessor level, CBOE appeals are Taxpayer friendly and are no cost.
The Board of County Commissioners (BOCC) oversees the CBOE and appoints independent and experienced Hearing officers/Mediators as third parties to preside over the hearings and make recommendations. Once all CBOE hearings conclude, the BOCC meet to approve or deny the recommendations. Petitioners are notified of the determinations by November 1st.
What to Expect at a CBOE Hearing
At a CBOE hearing, usually conducted over video conferencing or telephone, the Hearing officer first introduces themselves, explains the process, and then swears in the Homeowner and the Assessor’s office Appraiser that was assigned to your appeal. The Homeowner presents their case first, explaining why they appealed and provides “evidence” to support their reasoning (which I’ll explain shortly with helpful tips). The Appraiser then gets a turn to do the same. There’s often a back-and-forth discussion followed by the Hearing officer explaining the next steps and then concluding the hearing. It all lasts anywhere from approximately 15-45 minutes.
I’ve participated, as the Appraiser, in many CBOE hearings over the years which I actually enjoyed. Yes, I’m a bit of a property tax nerd, but I liked meeting the Property owner and hearing their point of view firsthand. I found that they usually left feeling relieved at how easy it was and with a better understanding of how their property value was determined.
Next Steps for Unsatisfied Property Owners
It helps to talk to your REALTOR® who understands the changes that occurred in the market and who can review your property value objectively. If you determine it is still incorrect, you can file for a CBOE appeal with your county’s Assessor’s office online, in person, or by mail by September 15th. A CBOE hearing appointment will be scheduled for you.
Tips in Preparing Your “Evidence”
Only choose valid sales in the study period: July 1, 2020 to June 30, 2022
Try to limit your chosen comparables to those that sold late 2021 and 2022
Choose comparables that look similar to your property (size, quality, proximity)
Account for appreciation with a time adjustment (good rule of thumb = 1.5-2% per month)
Include a few pictures if your home is not remodeled or has a negative influence
Stick with the facts, keep it simple and straightforward, and be respectful!
After November 1st, Property owners can continue to the next level of appeals and choose between the State Board of Assessment Appeals (BAA is when the County Lawyer’s up!); the District Court; or Binding Arbitration.
Taxpayers Have Rights, too!
Overall, the appeals process, no matter what level, is designed to be Taxpayer friendly and is a right every Property owner can exercise. Best of luck with a successful appeal!
Janell Arant is a REALTOR® for West and Main Homes in Colorado and a former Residential Appraiser for Douglas County Government.
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