Property owners in Evanston and the northern Cook County suburbs will be the first to feel the impact of the revised assessment process from new Cook County Assessor Fritz Kaegi. Commercial property owners are bracing themselves for a large increase as those assessments hit the mailboxes.
Evanston Assessments Soar
Evanston has received the first assessment notice in the mail under the new regime in the tax assessor’s office, and the estimated values are two or three times as high as they were during the last assessment period three years ago.
Landlords are not totally surprised by this, as Kaegi campaigned on a promise to reform the office and improve the accuracy of commercial property assessments, which many said were being undervalued under the previous administration.
However, the percentage of increase is surprising and comes on top of rising concerns about the viability of Illinois’ real estate market in general.
Higher Taxes Might Mean Higher Rents
Property owners must bear in mind, though, that an assumption about the overall property tax bill can’t be made based on the amount of the property tax assessment. An assessment that is doubled from previous years doesn’t correlate to a tax bill doubling. The final bill depends on a process called equalization, which looks at the relative change in assessed values among properties to ensure a level of fairness to the system. It also depends on how much local governments decide to collect in property taxes, which is a tax levy.
Still, property taxes are the largest cost for apartment owners, which means they have a direct impact on property values.
For homeowners in Evanston, who are estimated to have the state’s most burdensome property tax bills, this new assessment process could be good news.
From 2018 to 2019, the assessed value for all residential property rose 25 percent, while the assessed value for all commercial and industrial property rose 125 percent. This gap suggests that taxes will rise for commercial and industrial landlords but drop for Evanston homeowners when property tax bills are sent.
Property owners—both commercial and residential—can ensure an accurate property tax bill by checking if their assessment properly reflects both the attributes of the property itself as well as the valuation in line with the rest of the area’s property stock.
If not, it’s important for property owners to file an appeal to bring the bill more in line.