by Carrie Moritz, Gazette
It's no secret that housing prices in the area have gone stratospheric since 2020, and that Garretson has been near the top of the list in housing prices for many years. And this is no more realized than each February 15-March 1, when property tax assessments arrive in homeowners' mailboxes.
Many homes in the Garretson area have doubled in value since 2017, the last year listed on the Minnehaha County Equalization website. This has impacted assessment rates, making for a higher tax cost to property owners.
Those assessments can be challenged. Equalization meetings are held each spring, where property owners can ask for a reduced amount on the assessed rate of their home. They can often receive a recommendation from the town council or township board to have those rates reduced, though it's on a case-by-case basis and is somewhat subjective. If those owners do not agree with the council or board's recommendation, they can appeal with the county directly to seek an assessment closer to the perceived value of their home.
According to the Minnehaha County Equalization office, assessments are based off appraisals for homes, using standardized procedures in a mass format each year. Since the appraisals work off of recent sales of similar properties, the increase in home sale prices have severely impacted assessments. Property improvements and building costs impact those prices, too.
While the assessors at the equalization office don't set taxes, they are responsible for fairly setting property values, according to the equalization director, Chris Lilla. In 2022 with the Minnehaha County Commission, he blamed the hot sales market for increases in assessments.
However, the increase in interest rates over the past year have cooled that market off, something councilor Dave Bonte pointed out at the equalization meeting held by the Garretson City Council on Monday. The interest rate has made the higher-value homes, such as those sold over $500,000 in the past year, much less attractive as buyers find they have a set amount they can afford to pay each month.
This is unfortunate, said Bonte, as assessed values for 2023 have appeared to be higher than the actual purchase price a seller could get for their home. And it is unlikely that residents would see a reduction in those assessed values for 2024.
The Gazette took a random sampling of different addresses in Garretson to see what in-town homes were assessed at.
One home in central Garretson on Center Avenue that was valued at $59,500 in 2017, is now valued at $122,400. Another central Garretson home on 4th Street was assessed at $140,354 in 2017; this year it was $258,800. On the south end of town, a home on Leslie Drive was assessed for $232,793 in 2017. Five years later, it was $366,500, and this year, it was assessed for $441,800.
This means that tax assessments in Garretson have been in the double digits for most property owners, with the average increase for 2023 at 14% and 2022 at 18%.
The Equalization office attempted to keep the increase for this year between 10-20% for Garretson, according to City Finance Officer Paetyn Dreckman.
For the home on Leslie Drive, it was a 31.3% increase in valuation from 2022 to 2023.
Though the deadline for most homeowners to file for a reduction has passed, it is important to note that the full cost of property taxes for homeowners may not be as substantially affected.
A property valuation is relied upon by the auditor to determine the taxable value, and the total county budget determines how much cost burden is applied.
For instance, the house on Center Avenue paid $1,243.40 in property taxes in 2019. In 2022, property taxes were $1,473.86, making for an increase of $230.46, or 18%, despite an assessed value difference of $49,566. The house on Leslie saw an increase of $854.40, or 21.6% from 2019 to 2022.
However, it is important for property owners to keep an eye on their future assessments, ensuring that the county isn't over-valuing your property. Any homeowner who feels they need a new assessment can apply to have the equalization office survey their property at any time, even if the change in property values won't take effect until the next year.
There are options for those who are on fixed incomes and having difficulty making their property tax payments, including an assessment freeze for those aged 65 and older or those who are disabled. To qualify, an owner must be a South Dakota resident for the past 200 days in a single-family dwelling and must meet the annual income and property value requirements. Applications for the program are due to the county treasurer's office by April 1 of each year. Veterans may also qualify for property tax reductions or exemptions. To learn more about available programming, interested applicants can visit their local county treasurer's office or head to https://dor.sd.gov/individuals/taxes/property-tax/relief-programs/.
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