A record-high real estate market in 2022 drove a 30% increase in property valuations across the county. Some areas in the Methow Valley actually saw smaller increases of just 25%.
Increased appraisals based on 2022 prices
Property valuations — what the county assessor determines property is worth — have gone up by about 30% across Okanogan County. In fact, the Methow has some of the few regions where the increase was smaller, with a 20% jump in the town of Winthrop and 25% in some neighborhoods between Winthrop and Carlton.
The Okanogan County Assessor’ Office recently mailed 53,000 change-of-value notices to property owners. The assessor is required by state law to appraise properties every year and to adjust the value to conform to the real estate market.
The purpose of the revaluations is to arrive at a fair, equitable assessment for each property, compared to the properties around them, Okanogan County Assessor Larry Gilman said. “We don’t estimate values — we interpret the market that’s already happened,” he said.
Tonasket saw an increase of 20%, but other towns, including Twisp, Omak, Okanogan, and Oroville, all went up 30%, Gilman said.
Okanogan County is divided into six areas, with appraisers conducting a physical inspection of one area every six years (approximately 9,000 parcels per year). The other five get a statistical percentage adjustment (on structures, not land), based on sales of comparable properties within neighborhoods, Gilman said.
Annual revaluations help make the process fairer, since taxes are then based on a review of recent comparable sales, not on real estate sales from several years ago, Gilman said.
The revaluation cycle the Assessor’s Office just completed is based on sales in 2022, so some comparisons are more than a year old, Gilman said.
Real estate sales in 2022 brought the highest prices for individual properties ever, Gilman said. In the Methow, a house sold for $3 million, and numerous properties went for more than $2 million, he said.
Annual cycles
The current revaluations include a physical inspection of an east-west swath across the county starting about 3 miles south of Carlton and extending south of there, including Pateros and Brewster. Last year, appraisers physically inspected properties in the Methow Valley.
Appraisers are now starting on inspections for next year’s cycle, which covers properties around Omak, Okanogan and east of that area.
Physical inspections take into account remodels, deferred maintenance, and anything that affects the value of the home. Appraisers also inspect all new construction annually. This year, there are some 1,370 building permits to review, Gilman said.
Washington state requires assessed values to be at 100% of market value. Assessors measure the appraisal level by comparing appraised values to sales prices. This is commonly referred to as the “ratio,” which is calculated by dividing the appraised value by the sales price. For example, a ratio of 85% indicates a positive market adjustment was made to increase the assessed value. A negative market adjustment would be made to decrease assessed values if the ratio was above 100%, according to the Assessor’s Office.
On average, the ratio of assessed value in Washington is 86% of market value, but in Okanogan County, it’s currently about 78%, Gilman said. While assessors do their best to be accurate, when they’re chasing an increasing market, the ratio will never be 100%, he said.
Highest market ever
Gilman has been tracking sales over time to get an overall picture of the market. Although real estate prices remain high, assessors are seeing a stabilization of the market, rather than a continued escalation, Gilman said. Still, despite the trend toward stabilization, assessors don’t see prices dropping to anywhere near the assessed value, Gilman said. They’re also seeing a lower volume of sales and fewer properties on the market.
Real estate trends in the Methow Valley — and Okanogan County — mirror those in Washington and in many parts of the country. County assessors from across Washington said most areas haven’t seen a drop in prices yet, although Spokane is starting to bottom out, Gilman said. “This is the highest real estate market the nation has ever seen,” he said.
A good source for an overview of real estate trends is the map on Zillow.com, where people can look at sales of individual parcels in their neighborhood, Gilman said.
A perusal of sales on Zillow — or on the spreadsheet of comparable sales that can be downloaded from the assessor’s website — shows many properties throughout the Methow that sold for well over half a million, and quite a few over $1 million.
Still, it’s difficult to know all the factors that went into a sale price. Did the 800-square-foot cabin sell for more than $800,000 because of the land it’s on? What attributes made the 3,800-square-foot house in Mazama sell for $3 million last year? Are people paying for view or for waterfront properties?
Property tax impacts
Many property owners don’t understand that taxes generally don’t go up or down at the same rate as the assessed value, Gilman said. Property taxes are not like sales taxes, so a 10% increase in assessed value is not equal to a 10% increase in the next year’s taxes.
Property taxes are set by the county budget. Increases are limited to 1% more than what was collected in the prior year, plus the value of new construction and any voter-approved levies.
An explanation of the revaluation process is available on the county assessor’s web page under Change of Value (COV) Update and Information. More information is available under “Annual Revaluation” in the blue bar at the left.
Valuations based on physical inspection and of new construction will be sent out at the end of August.
Appeals
Since the valuation notices went out last week, the Assessor’s Office has been bombarded with phone calls, but only three people have submitted appeals so far, Gilman said. If people wouldn’t sell their home for less than the assessed value, there really are no grounds for an appeal, he said.
People have 30 days to appeal their valuation. This year’s deadline is July 3. Gilman encourages people to call the Assessor’s Office before filing an appeal.
Appeal forms and information are available on the Okanogan County website under “Documents and Forms” in the blue bar at the top, and then under “Board of Equalization.” Forms can also be obtained from the clerk of the Board of Equalization at (509) 422-7100.
