When a popular local realtor called the News-Press about a separate matter Tuesday, she mentioned that she was in the process of selling yet another home in the City of Falls Church. When asked if the sale price was anything akin to the house’s assessed value, she laughed derisively, as if to say, “Are you kidding?” She reminded us that assessed values assigned to homes in Falls Church apparently do not take recent property improvements into account.
This, yet another confirmation of the highly disturbing report published in the News-Press two weeks ago of the apparent disconnect between assessed values and market values of residential real estate in Falls Church, underscores a serious problem that appears to be getting almost no one’s attention.
The fact is that, by law, assessed values are supposed to match market values one-to-one in Virginia. When the Falls Church City assessor released his annual report earlier this month, in conjunction with mailing assessment notices to all City properties, he determined that, overall, the value of detached single family homes in the City (the largest single category contributing to the City’s tax revenues) rose only four percent during the last year.
However, the News-Press conducted a cursory review of all 35 sales of such homes consummated during the last six months of 2010, and found that, on average, the sale prices were not four percent, but over 15 percent above their January 2010 assessments.
This disparity is extremely important when it comes to the budget constraints that the School Board, city manager and City Council face in the first months of this year. It could point to the fact that the City is locked in to taking in far less in tax revenue than it ought to be, and therefore has far less to spend on maintaining quality schools that are competitive with others in the region.
It cannot be stressed too strongly that its schools are the economic engine driving the sustainability of the City of Falls Church. The reputation of the Falls Church school system is second to none, and the determination of families to relocate to the City so their young can attend the City schools provides a “value added” of 10 to 15 percent on real estate here.
That explains why, while the overall population in the 8th U.S. Congressional District of Northern Virginia has actually declined over the last decade, according to the U.S. Census the City of Falls Church has experienced an 18.8 percent population growth since 2000. Since 1990, when the News-Press came into existence, the growth has been from 9,600 to 12,300, an increase of 28 percent, which is an astonishing number given the lack of space and facilities for easy expansion.
This net growth is due almost entirely to the schools, and it has enabled the City to endure even during tough times. Now, the City could be unduly constrained against maintain its schools by dramatically undervaluing its real estate.