The real estate sector has been down so long that good news is a relative term. Given the new normal, the news from the Ada County assessor’s office is at least encouraging. The median home value in the county is now $138,800, a decrease of “only” 1.7 percent from 2011.
Yes, that’s better than three years of double-digit declines. But it also means the county’s 2008 median home value, $208,100, is little more than a distant memory.
The stabilizing home values come too late for homeowners who climbed on the housing bubble at the wrong time, only to find themselves upside down on their mortgages. It also comes too late to help a construction sector that has had to fight an undertow of declining values and distressed inventory.
While Ada County’s home values are stabilizing, the results are hardly across-the-board. Property values in Nampa and Caldwell dropped by another 9 percent and 11 percent, respectively.
The real estate sector, a driving force behind the Valley’s 20-year economic boom, is by no means fully recovered from its protracted downturn. A modest decline is still a decline — and for local and state officials, it should still be a cautionary note.
For local governments, who are just embarking on their annual budget-writing process, the property assessments provide one more good argument for fiscal conservatism. (Even when property values decline, there is no guarantee property tax bills will follow suit. The actual property tax bill is determined by the tax rates established by local taxing districts, such as cities, counties and highway districts.)
Ada County, the Ada County Highway District and five of the county’s six cities held the line on property tax collections in 2011; Boise took a 1.5 percent increase, or half of what is allowed under state law. As long as property values are hurting, local leaders should first look for creative partnerships to pay for any new initiatives.
State leaders need to do their share to ease the strain on property owners as well. Years of public school budget cuts left local districts no recourse but to seek property tax levies to make up the difference — and, in districts such as Boise and Meridian, voters responded. If legislators are determined to repeal the property tax that businesses pay on supplies and equipment — a cumbersome tax, but a key funding source for local governments — the state needs to find a way to offset this tax cut. Passing on the burden to property owners simply won’t cut it.
The housing market may finally be bottoming out. But for homeowners and property owners, the pain hasn’t completely eased. That’s something state and local elected officials must keep in mind.
“Our View” is the editorial position of the Idaho Statesman. It is an unsigned opinion expressing the consensus of the Statesman’s editorial board. To comment on an editorial or suggest a topic, email editorial@idahostatesman.com.
