News

By Mary Hladky

    Ten years after housing prices began cratering in the Great Recession, taxable property values in Palm Beach County have zoomed past their previous record high set in 2007.
    While the previous peak was $169.4 billion before the housing bubble burst, taxable values countywide jumped 7.1 percent to $176.5 billion last year, according to estimates released May 26 by Property Appraiser Dorothy Jacks.
    This is the fifth year in a row that values have surged, although once double-digit growth has slowed in recent years.
    But increases in the county and municipalities remain generally within the 6-8 percent growth rate considered healthy before the real estate crash. Taken together, city increases averaged 8.81 percent.
    “This (7.1 percent) is a good number as far as healthy growth, but not too heated growth,” Jacks said.
    The recovery in home prices and the completion of large construction projects countywide that are now on the tax rolls have spurred year-over-year gains, she said.
    “New construction continues to be a strong part of our economy,” Jacks said. “A lot of big, signature products came on line. … That is helping our overall values.”
    Delray Beach outpaced other municipalities in south Palm Beach County with taxable property values increasing 9.25 percent.
“I’m happy to see our values continue to increase,” Delray Beach Mayor Cary Glickstein said in an email. “This increase, which exceeds that of any other large city in the county, shows we are on the right track in terms of what we offer as a place to live and do business.”
    Glickstein said he anticipates the City Commission will decrease next fiscal year’s property tax rate somewhat.
    Boca Raton saw a 7.07 percent rise in taxable values, while Boynton Beach was up 7.41 percent.
    The values increased 8.62 percent in Briny Breezes, 3.03 percent in Gulf Stream, 7.84 percent in Highland Beach, 7.22 percent in Lantana, 5.52 percent in Manalapan, 6.18 percent in Ocean Ridge and 6.5 percent in South Palm Beach.
    Briny Breezes Mayor Jack Lee noted his town’s location on the ocean, the ability of homeowners who live along canals to keep their boats outside the front door and the town’s safety as pushing property values up.
    “It is about the location,” he said. “It is a matter of supply and demand.”
    Jack Elkins, a real estate agent with the Fite Group, expects values to increase further.
    “We won’t have the insane growth we have seen in the past, but we will continue to have growth and appreciation,” he said.
Elkins, who concentrates on coastal communities including Manalapan and Hypoluxo Island, said interest in properties there will remain high.
    “The coastal communities are still strong,” he said. “There is only so much land.”
    The municipality posting the biggest gain in the county was Palm Springs, with a 22.32 percent jump, followed by Loxahatchee Groves, up 15.12 percent. Pahokee fared the worst with a mere 0.6 percent gain.
    Elkins agrees with the consensus of real estate experts that U.S., and Palm Beach County, value increases do not signal a new housing bubble.
    “Some people will ask whether passing the 2007 peak means the housing market is in another bubble. It’s not,” the national real estate website Zillow said in a May posting.
    “The fact that it took (median home values) a decade to return to this point, let alone exceed it, is a testament to how far the market fell when it crashed. It’s also a reflection, of course, of how outlandishly high it had climbed.”
    In Palm Beach County, the median home value was $252,600 in April, but that was 21.2 percent lower than the peak, according to Zillow’s data.
    The Property Appraiser’s Office will factor in 2017 data to revise its estimates before a preliminary tax roll is submitted to the state on July 1.
    Local governments use the estimates to begin calculating how much property tax money they can expect in the coming year so they can set their annual budgets and 2017-2018 tax rates.
    That process will end in about mid-September before the Oct. 1 start of the new fiscal year.
    An increase in taxable values means that the county, cities and towns will collect more money from property owners if they keep their tax rates the same as last year.
    Elected officials can increase the tax rates even though property values have risen, but they typically don’t want to anger taxpayers by doing that.
    They often opt to decrease the rates by small amounts so they can say they have lowered taxes even though their tax revenues rise because of increased property values.
    Last year, only five of the county’s 38 municipalities lowered tax rates enough so that taxpayers did not pay more in taxes.
Officials have said they need the money to pay for increased operating costs and to make up for the lean years during the recession when they cut budgets, left positions unfilled and delayed improvement projects.