The Rochester metropolitan area has seen a significant increase in home prices since 2020, ranking near the top of Realtor.com’s list of the nation’s “hottest real estate markets.” Monroe County in New York has been a leader in price growth, with a 53 percent increase in median home prices in 2023, second only to Orange County.
Sellers in Monroe County received a 15 percent premium over their asking price on average, reflecting the hot housing market in the area. Homes in Metro Rochester sold faster than in most other large metros in May, driven by historically low inventory. The city of Rochester has also seen an increase in property wealth due to rising home values, as reflected in recent property reassessments.
City Assessor Michael Zazzara noted that the surge in prices began in 2018 and 2019, with buyers paying significantly more than the assessed values. The citywide increase in property wealth is estimated at around $3 billion compared to before the reassessment, with assessments for homestead properties increasing by 65 percent and non-homestead properties by 36 percent on average.
Neighborhoods like Browncroft, the South Wedge, and North Winton Village have shown significant appreciation in recent reassessments, leading to price increases in surrounding areas. ZIP codes with nearly doubled assessed values from 2019 to 2023 include 14605, 14621, 14611, 14609, and 14608.
The soaring market prices have made it more challenging for buyers, especially first-time home buyers, to enter the market. Higher assessments have raised concerns about potential tax increases for homeowners. However, an assessment increase does not necessarily mean a tax increase, as a homeowner’s tax bill is based on their property’s share of the total assessed value.
Mayor Malik Evans and the City Council worked to keep the levy constant in Rochester, resulting in a lower tax rate for the 2024-25 fiscal year. The city’s tax estimate tool allows users to compare properties and see how assessment changes impact tax bills. County tax bills are also affected by property assessments, with different rates in different areas due to varying assessment practices.
Overall, the real estate market in the Rochester area has experienced significant growth, leading to higher home prices and property wealth for homeowners. The impact of these changes on tax bills varies depending on individual property assessments and local tax rates. The math behind property taxes can be a bit complex, but here’s a simplified breakdown:
– The owner of a property in Hamlin pays 2.422 percent of $67,000, which equals $1,623 to Hilton Central.
– The owner of a property in Clarkson pays 1.623 percent of $100,000, which also equals $1,623 to Hilton Central.
Tax rates are equalized by the state Department of Taxation and Finance across districts with different assessment ratios. This equalization process compares actual sale prices of properties to their assessed values and calculates an equalization rate.
The county tax levy for 2023 is $447 million, shared among property owners based on each owner’s share of the total county taxable assessed full value. For example, Rochester taxpayers paid 8.3 percent of the total levy as the taxable assessed full value in the city was 8.3 percent of the county total.
The equalization process ensures that all property values are adjusted to “full value,” impacting county taxes. A change in assessment could increase county tax if the home’s value rises faster than others in different areas.
City Assessor Zazzara advises homeowners to consider the benefit of higher home equity, as it could result in a larger profit when selling the home.
Overall, the county levy is based on your share of county assessed value after equalization. It’s essential to understand how property assessments and taxes are calculated to make informed financial decisions.