Assessed value increase less than last year

PALMER—Assessment notices for 72,842 property owners in the Matanuska-Susitna Borough went out in the mail recently.

While the assessed value of property in the MAT-SU continues to increase, the rate of increase has slowed. Assessments on average went up 7 percent this year, compared to 11 percent last year. A home worth $200,000 in 2006 might now be worth $214,000.

Competition drives value. For the past 16 years, the MAT-SU has been the fastest growing community in the state. The MAT-SU now makes up 11 percent of the state's population, according to state economist Neal Fried. Last year another 2,396 people moved into the Borough, a greater number than moved into Anchorage. Many of the new MAT-SU residents come from Anchorage, Fried said.

The MAT-SU is attractive because land and home values are less than in Anchorage, though that gap has been narrowing. In the first half of 2006, the average sales price of a single-family home in the MAT-SU was $219,324. By contrast in Anchorage a similar house would go for $306,000, according to Borough Assessor Dave Dunivan.

In 2006 home sales here continued to increase as large numbers of houses were on the market, according to Borough Economic Development Director Dave Hanson. Hanson said some people in the real estate industry believe the housing market was over built in the 2004 - 2005 period. "We are likely entering an adjustment period of about a year for the market to come into balance as fewer houses are being built. Despite this situation, a larger number of houses sold at higher-than-ever-before prices during the first 11 months of 2006," Hanson said.

According to the Alaska Multiple Listing Service, in 2005 through Nov., 1,066 houses sold on average for about $213,000. In 2006, 1,228 houses sold on average for about $225,000. More houses sold in 2006 and at a higher average price, Hanson said.

Every year, state law requires the Borough to find the full and true value of property. The Assessment Division does not create value. It interprets the market to come up with the assessed values.

Assessor Dunivan said the Assessment Division first reviews all the property, then systematically values it based on criteria that can be quantified and measured. The Assessment Division takes the entire inventory of all properties in the Borough, segments them into like-kind groups, and statistically come up with values of properties within the same group.

Although assessments rose, on average, 7 percent this year, that doesn't mean that property taxes will rise similarly. In 2005 the Assembly passed a property tax cap. Because of the cap on tax revenues, taxes are for the most part based on last year's mill levy and adjusted based on population growth and the consumer price index.

The mill rate is not set yet and must be set by May 31.

Property owners can appeal their assessments until March 30.

For more information contact Assessor Dave Dunivan at 745-9647.