Charlottesville sees its 1st drop in home values

Charlottesville real estate values have declined for the first time since the city government began keeping records, according to figures released Thursday.

The 2010 assessments show that average values for existing residential properties in the city declined by 2.19 percent. Existing commercial property values also declined by .34 percent.

“We’ve had a whole lot of less sales,” said Roosevelt Barbour Jr., the city assessor.

When including new construction, the total assessed value of all city property declined by .76 percent.

“It’s pretty much all dictated by sales,” said Barbour, adding that the city saw 21 percent fewer sales in 2009 than the year before. “We just interpret the market. We don’t make the market.”

The city government has been keeping track of assessment growth since 1976. Values peaked in 2006, when there was a 15.34 percent average increase among existing residential and commercial properties.

Bernard Wray, Char-lottesville’s finance director, said that based on the most recent figures, the city would garner roughly $175,000 less in real-estate taxes than budgeted if the tax rate remains steady. The city had assumed, for budget planning purposes, that overall real-estate assessments would remain flat.

“We were expecting it to be pretty close to that,” Wray said.

City Manager Gary O’Connell said the proposed fiscal 2011 budget is based on a 95-cent real-estate tax rate, the same as the current rate. If the rate remains flat, residents whose assessments decline would pay less in real-estate taxes.

City resident John Pfaltz, who has continually gone to the City Council imploring the body to reduce the tax rate, said he agrees with the city manager’s tax-rate proposal because of the impending loss of revenue. But he added, “The tax rate should have gone down five years ago.”

Of Charlottesville’s 43 neighborhoods, 21 saw their residential assessments decline. The largest decrease was in Orangedale, which saw values decline by 26 percent. Ix/Belmont and Carlton/Belmont also saw sizable declines of 13.8 percent and 11.9 percent, respectively.

Home values in 18 neighborhoods remained flat and four — Greenbrier, Rose Hill, Johnson Village and Little High Street/East Jefferson Street — saw growth despite the suffering residential real-estate market.

“You don’t want to pay taxes but you don’t want to lose value on your property either,” Barbour said.

Of the properties in the city’s commercial areas, all but two remained flat in their values — Court Square and the Central Business district, where assessments declined by .11 percent, and Market Street, which declined by .23 percent. No commercial properties saw growth in values.

Total property assessment growth shrunk to 1.69 percent in the 2009 assessments, yet Charlottesville still managed to see some growth in property values then, unlike in neighboring Albemarle County, where values declined.

Also in the 2009 assessments, existing home values in the city increased an average of 1.02 percent.

The headline of this article was edited for accuracy.