Sky-high sale of NONCOMPARABLE neighborhood property resulted in 70% property tax hike for Axios journalist ... Great example of why homeowners should always scrutinize their assessments by appealing
March 05, 2024 10
An Axios journalist based in Chicago has reported a depressingly common property tax story which, without intervention, would have cost her thousands of dollars of overpayment to Cook County.
A much fancier property than reporter Monica Eng's own condominium sold nearby, she writes. Then, the Cook County Assessor's Office tied her condo's property tax assessment to the price of this sale.
The result? This one sale caused her property tax bill to jump 71%.
Eng says she tried appealing only to be denied. Finally, she filed a Freedom of Information Act request to access the County adjudication file, which would show why the County saw fit to deny the appeal.
What did she find?
"I was easily able to see the 'comp' used to deny my appeal through my reporting process," Eng writes. "When I examined this supposed 'comp,' I saw it was a much bigger, fancier unit housed in a 21-year-old building. Remember, my building is 122 years old."
Unfortunately, this happens all the time. It's called "sale-chasing," and it is a technically an illegal practice. But, we at Property Tax Solutions view countless reassessment valuations each year. We see it happening. A property will sell for more than its assessment and then the reassessment comes along and spikes the property's value to either exactly the price of the sale or very close to it, and sometimes even higher.
As Eng noticed, it also happens when a high-price sale happens nearby the subject property. The Q&A section of the DeKalb Township Assessor's webpage offers a serviceable, concise description of the practice: "I’m about to buy a house for more than 3 times the current assessed value. Will the Assessor raise my assessment based on that sale? No, it is illegal in the state of Illinois to “chase sales” or revalue based on individual sale of properties, either up OR down. Assessors in Illinois use mass appraisal techniques, such as a sales ratio study, to determine the median value of groups of like properties. Property value will only be looked at individually, at the request of the owner of that property, if sufficient information is provided by the property owner to merit a review by the Assessor."
A mass appraisal system is supposed to factor in all sales, higher and lower, to arrive at the fairest estimation of a property's value. That's not what we see happening. For years, PTS has witnessed higher neighborhood sales and individual property sellings prices favored, and Eng's ordeal reveals the County is not only engaging in this but openly saying so in its adjudication file. They denied her appeal on the strength of one sale alone. Codified sale-chasing.
PTS sees it in practice. Both the Assessor and Board of Review will frequently refer to an individual property's recent sale as a justification for maintaining a proposed assessment. But that is not the proper application of assessment law. We argue, and win, scores of tough cases each year by insisting on fidelity to the law, which states that a property's sale price does not matter at all if a representative slice of nearby properties in the same class have lower assessments. In other words, we insist that your tax bill ends up no higher than that of your lowest-assessed neighbor.
The only way to ensure you are not subject to sale-chasing is not just by appealing, but appealing with the right representatives who have top-tier data processing and complete command of the law at hand. In Cook County, Property Tax Solutions is that firm.