Maryland tax officials, in a review of tens of thousands of residential and commercial properties, are reporting a more than 20% overall increase in property values since 2020, according to state data.
About a third of the state’s 2 million property accounts are appraised every year, which determines the amount of property taxes home and building owners must pay. This year, “Group 2″ was reassessed for the first time since 2020, which was completed just weeks before the coronavirus pandemic swept the nation. The three groups rotate every three years.
Since Group 2′s last assessment, residential property values increased 22.2% on average, while commercial properties rose 15.8% on average, for an overall increase of 20.6%, according to the Maryland Department of Assessments and Taxation. The overall statewide increase beat 2022′s jump of 12% and is the highest year-over-year value hike in several years.
The assessments were based on an evaluation of close to 90,000 sales that took place within the group since January 2020. More than 96% of residential property values increased during this time, according to a news release from the state agency.
All 24 jurisdictions in Maryland saw increases in residential and commercial property values, according to the data made public by state officials this week. Michael Higgs, the director of the state department of assessments and taxation, said the increases demonstrate steady growth and a strong real estate market in Maryland. The assessments are conducted “uniformly and fairly,” he said in a Thursday news release.
“It shows there’s an incredibly robust housing market, from one end of the state to the other,” Higgs said in a Wednesday interview with The Baltimore Banner.
With commercial properties, meanwhile, “It is still a strong market with a lot of transactions, and it supports an increase in valuation,” he said.
Residential properties in Garrett (53.9%), Somerset (48.8%), Washington (36.8%) and Worcester (35.3%) counties recorded the highest changes in market value since 2020. In the commercial category, Cecil (36.6%), Talbot (23.6%), Frederick (21%) and Kent (19.4%) counties led the pack.
In the Baltimore region, Carroll County recorded the highest combined residential and commercial combined value change, at 23.9%. Baltimore City followed at 21.6%. And neighboring counties including Howard (20.4%), Anne Arundel (17.4%), Baltimore (16.4%) and Harford (16%) counties also recorded double-digit changes in both categories.
Higgs attributed the strong growth in Western Maryland and the Eastern Shore to “COVID-related trends,” such as more people buying homes and investment properties outside of densely populated areas. The overall jump and rapid pace of growth may also indicate that there remains a disconnect between housing demand and supply in Maryland.
“I don’t see any signs of relief; we’re not doing enough on zoning or on other regulations that would encourage more housing right now, and I don’t see it in the pipeline” said Higgs. “I think the rate of increase will slow down, but I see a continuing upward trend.”
State legislation has capped property tax increases for owner-occupied properties at 10%, though the limits are even lower in several counties. Some homeowners are eligible for credits against property tax bills via the Homeowners’ Property Tax Credit Program. Residential property owners may also be eligible for the Homestead Tax Credit, which limits their principal residence’s taxable assessment from increasing by more than a certain percentage regardless of their income level.
This article may be updated.