Property revaluation: What it does, doesn’t mean

If you read our July 25 report on Burke County’s 2027 property revaluation and came away believing your property taxes are increasing by 22%, let us say this plainly: That has not happened.

Everyone knows a 22% tax increase in one year would cripple our economy and Burke homeowners.

The Burke County commissioners have not adopted a new property tax rate for 2027. They have not even assigned new values to individual properties.

Our report didn’t say taxes were going up. Still, the reaction from readers tells us that we needed to draw a bolder line between property values and property taxes.

They are related, but they are not the same.

WHAT REVALUATION MEANS

While no increase or change in property values or tax rate has occurred, we can speak with a high level of certainty that property values will change next year.

North Carolina law requires real property (like your home) to be assessed at its current market value – not the value when you purchased the home. Burke County last conducted a revaluation in 2023 and operates on a four-year cycle, making the next one effective Jan. 1, 2027.

And a lot can change in the housing market over those four years.

County officials said at the board of commissioners’ July 20 meeting that, on average, properties are currently valued for tax purposes about 22% below their 2025 market value. In simple terms, properties included in that study were generally assessed below the prices for which they were selling.

The ratio is a countywide measure. Values may have risen faster in some neighborhoods and more slowly in others. Some properties could increase substantially, while others could change little or even decline.

Appraisers must consider location, property type, age, condition, construction, land use, and comparable sales. A waterfront home at Lake James will not be treated the same as a similarly sized home in a neighborhood where sale prices have remained relatively stable.

The schedule of values expected to go before county commissioners this fall will establish the rules used to perform those appraisals. It will not establish the tax rate.

WHAT REVALUATION DOESN’T MEAN

A higher assessed value does not automatically produce a tax increase of the same percentage.

A property tax bill is determined by two numbers: the assessed value and the tax rate. The formula is the property’s value divided by $100, multiplied by the tax rate.

Burke County’s current rate is 55.5 cents per $100 of value. At that rate, the county tax on a $200,000 home is $1,110.

Suppose, only for illustration, that the home’s value increased by 22% to $244,000. If the rate remained at 55.5 cents, the tax would rise to $1,354.20.

But the rate does not have to remain at 55.5 cents.

When a county conducts a revaluation, North Carolina law requires its proposed budget to show a “revenue-neutral” tax rate. That is the rate estimated to generate approximately the same property tax revenue the county would have received without the revaluation, with adjustments for normal growth such as new construction.

In our example, commissioners could choose to lower the rate to about 45.5 cents, which would produce roughly the same $1,110 tax bill on the newly valued $244,000 home. That is only an illustration; Burke County’s actual revenue-neutral rate cannot be calculated until the entire tax base has been revalued.

WHAT TAXPAYERS SHOULD WATCH

County commissioners will decide the 2027-28 tax rate during next spring’s budget process, likely in June 2027. They may adopt the revenue-neutral rate, a rate below it, or a rate above it. State law requires them to disclose the revenue-neutral figure, but it does not require them to use it.

That is the decision taxpayers should watch.

Even if commissioners adopt a revenue-neutral rate, individual bills will not all remain unchanged. A property that increases more than the countywide average could see a higher bill. One that increases less than average could see a lower bill. Municipal and special-district rates also can affect the final total.

Property owners also will have the right to appeal if they believe their new value exceeds the property’s market value or was calculated using incorrect information.

For now, Burke County is updating the value side of the equation. The tax-rate side has not been decided.

A revaluation tells us what property is worth. The budget tells us how much government intends to collect. Only when we have both numbers will anyone know what the 2027 revaluation actually means for individual tax bills.

Rest assured that The Paper will report on revaluations and tax rates every step of the way.