Property assessments, calculated every three years for tax purposes, are on the rise in the Homewood-Flossmoor area. For some residents, higher property assessments may be a reason to grumble. After all, an increased assessment might point toward higher property taxes. But government officials, on both the county and local level, say otherwise. For them, higher property assessments reflect higher market prices for homes and are a positive sign that the local economy is improving.
Property assessments, calculated every three years for tax purposes, are on the rise in the Homewood-Flossmoor area.
Overall, the 2017 triennial reassessment showed median assessed valuations rising between 11.26 and 17.4 percent in H-F neighborhoods. The new assessments are based on housing sales between 2014 and 2016.
Median housing sales during that period ranged between $133,000 and $350,000 in Flossmoor, with the highest prices listed in the village’s Ballantrae neighborhood. Median housing sales in Homewood ranged from $124,000 to $188,000, with the highest prices listed in the neighborhood north of 183rd Street, south of 175th Street, east of Western and west of the Metra tracks.
For some residents, higher property assessments may be a reason to grumble. After all, an increased assessment might point toward higher property taxes.
But government officials, on both the county and local level, say otherwise. For them, higher property assessments reflect higher market prices for homes and are a positive sign that the local economy is improving.
“The reason you want to see assessments go up is because for most people, their home is their largest investment,” said Dennis Bubenik, Homewood’s finance director. Homeowners hope to see the value of that investment grow over time so that when they eventually sell their property, profits can be used to finance a larger home or help plan for retirement, he said.
Over the long run, it’s a good thing that assessments go up, Bubenik said. As assessments rise, so does the overall value of a community — the equalized assessed valuation (EAV) — and that tends to reduce the property tax rate.
However, he added, “in the short run there are complaints about this happening.”
The 2017 triennial reassessment showed double-digit jumps in residential property values throughout Homewood and Flossmoor. The Cook County Assessor’s Office, which surveys housing sales to establish figures for taxable property, sent assessment notices to 362,582 south suburban homeowners last year.
Tom Shaer, the deputy assessor for communications, said reassessment numbers are based on home sales in the area between 2014 and 2016. The assessor’s office looks at specific neighborhoods in suburban townships and bases the reassessments on housing prices in those areas.
For instance, Flossmoor’s Heather Hill area — bounded by Flossmoor Road on the north, Vollmer Road on the south, the Metra tracks on the east and Governors Highway on the west — is considered a neighborhood by the assessor’s office. According to the reassessment, median housing sales in the neighborhood ranged between $177,000 and $206,000 during the period that was surveyed, resulting in a median 15.82 percent increase in assessed valuation.
However, since neighborhoods are classified as parts of townships, they can also include portions of other communities. One of the largest neighborhoods for property in Homewood is bounded by the Metra tracks on the west, State Street on the east, 175th Street on the north and 183rd Street on the south. It also includes sections of Glenwood and Thornton. During the three year period that was surveyed, median housing sales in that neighborhood ranged from $151,000 to $174,000, resulting in a median 14.16 percent increase in assessed valuation.
Homewood is located in four townships — Rich, Bremen, Thornton and Bloom. Flossmoor’s eastern portion is in Bloom and western sections are in Rich. The H-F Chronicle looked at data from the assessor’s office for 17 neighborhoods in the four townships. The figures provided by the assessor’s office are just for single family residential properties and do not include condominiums.
Shaer, of the county assessor’s office, said the 2017 reassessment shows that the area’s residential sales market is recovering from the 2008 recession and subsequent housing crash. The previous two triennial assessments showed the effects of the crash, he said, with the numbers in 2011 based on some of the worst years for real estate sales and the 2014 reassessment including only one year of recovery.
The growth in the housing market continued last year in Homewood and Flossmoor, Shaer said. He provided figures from the third quarter of 2017 showing that 103 houses in Homewood sold for an average price of $169,000. In Flossmoor, 60 houses sold for an average price of $223,000 during that period.
The 2017 reassessment showed double-digit increases for median assessed valuation in Rich, Bloom and Bremen townships. Thornton Township showed a median growth of just 6.5 percent in assessed valuation.
Assessed valuations are one component of the complicated process that determines local property taxes. The county assessor’s office is responsible for determining the market value of taxable property. In Cook County, the assessed valuation for residential property is set at 10 percent of market value. The assessor’s office provides assessed valuations to the Cook County Board of Review, which then forwards them to the county clerk’s office. The county clerk is responsible for setting property tax rates.
For that to happen, the State of Illinois must first add an equalizer factor that is multiplied against the assessed valuation. This results in the equalized assessed valuation (EAV). The total EAV of a specific governmental unit, such as the village of Homewood or Flossmoor, is used to compute tax rates. So is the tax levy provided by the governmental unit. That shows how much property tax revenue is needed to fund operations in local government.
Overall EAV in local communities, including Homewood and Flossmoor, has fallen sharply since 2008 and much of that decline can be blamed on the housing crash. Last November, Flossmoor Finance Director Scott Bordui said the village’s EAV had gone up for the first time since 2011. In the years after the recession, Flossmoor’s EAV dropped by 38 percent.
Bordui said Wednesday that a rise of nearly 15 percent in Flossmoor’s EAV — that’s possible with the new assessments in the village — would probably cause the municipal portion of the property tax rate to go down. In addition, a higher EAV would allow Flossmoor greater flexibility in three important municipal funds, which deal with police, fire and corporate operations.
“This is good news,” he said. “We are definitely headed in the right direction.”
Increases in assessed valuation will be reflected on the second installment of property tax bills that will be received in 2018. All of Cook County’s south suburbs were reassessed in 2017. Property in the City of Chicago will be reassessed in 2018 and the north suburbs in 2019.
Shaer said it is important that county residents understand how assessments are determined.
“A lot of people think there’s a mystery man in a room with a pencil and eraser,” Shaer told the Chronicle. “That is utterly ridiculous; it is as scientific and precise as we can make it without having inspectors to go to each of Cook County’s 1.85 million pieces of property every three years. That would require thousands of inspectors and cost the county $200 million per year.”