Appealing property value pays off for hundreds of Minneapolis homeowners

After homeowners complained en masse about their tax valuations, the city of Minneapolis changed the property assessments for more than 1,000 homes this year.

City assessors and the board that handles appeals have spent the past month scrambling to respond to the 1,400 property owners who said the city tax assessor had bungled the valuation of their real estate. The board approved changes on 1,144 of those properties, or about 82 percent of official appeals, according to data released by the city Wednesday.

The reductions amounted to about 10 percent of the properties' assessed value, city data showed.

The rise in appeals has been driven in large part by property owners who think their values are estimated too high. Minneapolis is in the throes of a housing shortage that's contributing to soaring property values. While that's good for those looking to sell for a profit, it's led many to worry that their property tax bills could go up next year.

Among them is Scott Ewing, who appealed after the city valued his south Minneapolis home at $65,000 higher than the year prior, putting his estimated value at $471,000. A city assessor performed an on-site inspection and ultimately agreed the city overvalued his home and brought it down to $430,000, he said.

Ewing said he was pleased with the result, but he wondered how many others questioned their value and didn't go to the trouble of appealing.

"I wouldn't be surprised if there's a lot of people who are intimidated by the process," he said.

Palmisano's 13th Ward encompasses the neighborhoods with the highest number of appeals, and she's urged constituents who questioned their values to appeal. She's heard from some who were successful, but she questions whether some were afraid to fight City Hall.

"It's really important that we get this right," she said, and that often means going through the appeal process and getting an inspector to come to the home.

Palmisano reiterated that property taxes are more complicated than people realize, and the fact that a home's valuation goes up doesn't necessarily mean its owner will pay more.

When a property owner appeals, a deputy assessor visits the property to inspect it. If the assessor changes the value, the homeowner can either accept it or plead the case to the local appeals board, though most settle for the former option.

In a presentation earlier this year, City Assessor Patrick Todd attributed the rise in appeals to several factors, including the staggering rise in the worth of Minneapolis real estate. The total estimated real estate market value in Minneapolis jumped from $36.1 billion to $52.3 billion over the past four years, an increase of 45 percent, according to data presented to the City Council earlier this year. Todd also attributed the spike in appeals to social media sites like Facebook and NextDoor and websites like Zillow, which offer their own assessments of market data that can differ from the city's.

His office communicated with more than 3,300 property owners, and about 1,400 took the step to appeal. That accounts for slightly more than 1 percent of all of the properties assessed, he said.