This article is revised and updated from one that appeared in the Winter 2006 newsletter. If you will recall, Mike Ryherd, our Floating Homes Association lobbyist, Melissa Ahlers (FHA Board), and I met with Michelle Hagen, Director of Commercial/Business Division, and Joe Arnold, Commercial Appraiser, in September 2005 to have them explain how they appraise the floating homes community, both personal property (houseboat) and the land (slip) portion. The main thing we all agreed on is appraising floating homes is a very difficult job. There are so many different scenarios and dock ownership models that having black-and-white procedures is really impossible, but they are making every attempt to be fair and equitable in their appraisals across the floating homes community.
Personal Property
All floating homes are given a grade of 1-5 based on 3 elements:
- Quality of construction
- Condition (how the structure has been maintained)
- Square footage
That's it. They do not take anything else into account. So, if you want to appeal your floating home appraisal, you must be able to prove them wrong about one of those three things.
Land
Land is valued as if it is vacant. The land parcel values (that portion of land or mud that the dock may own) are simply a total of the individual slip values. We are NOT taxed on DNR or City leased land. The appraiser uses the same method for calculating the total value of the land as noted below (a value per site that increases from $250,000 to $750,000 according to the location of the site), but when he has the total, he then looks at what is DNR land and takes that portion of the value and assigns it to the DNR parcel, not to the floating home parcel. It is true that DNR doesn't have to pay taxes on it, but neither do we. The above also applies to slips on City street leases.
This year there were changes in the assessor's approach to the allocation of the value between the land parcels and the floating homes. The slip values were increased and the inside slips were generally valued at $250,000 and the end slips were valued as high as $750,000 in some but not all cases. Because of these slip value increases, the dock owned land value in general had substantial increases. This year, the views, open water, easiness of lake access, etc. were taken into account in valuing the individual slips. Because of this, there is not necessarily a proportionate increase in value as one goes from the inside slip to the outside slip, even though the values do increase in that process. In many, but not all cases, this land value increase allowed the floating home value to decrease.
Appeals
So, what does this mean to you regarding appealing your assessment?
First, keep in mind that the appraiser is only the appraiser. He comes up with the value of the land and of the floating home, but the King County Assessor's Office has nothing to do with what that translates to in taxes. The County decides on the tax levy, and what special levies might be passed by the voters (schools, parks, etc.), to determine the tax rate. Your taxes can go up even if your appraised value does not.
When looking at whether to appeal or not, take into account the three things (quality of construction, condition, and square footage) for the personal property, then look at your location on the dock and estimate what the land value for your site is. Add those two together and ask yourself this question: Can I sell my houseboat for this?
Also, note that appraisals are based on values from at least 1-2 years in arrears. The Appraiser is required to actually look at our homes every six years, but Joe Arnold says that he will have looked at all of the floating homes by the end of this year (which will be his fourth year appraising floating homes). Sales that have occurred in the previous three years are used for comparables.
Joe Arnold informed us that the successful houseboat appeals have uncovered issues of 'Quality' or 'Condition' that the assessor did not take into account. The successful land or 'slip' appeals have brought to light issues that are unique to the location that were not considered at the time of valuation.
Joe is very willing to talk with us so feel free to contact him directly with questions, 206.205.5534 or e-mail me at sgreaves@fhcrc.org and I will do my best to get answers for you.