The Atlanta apartment market, much like the national market, capped off its strong 2012 performance with a strong 2013. Whether or not you are experiencing the growth in your property, the Atlanta GA tax assessor sees these numbers and will use them as a part of projecting what your property's tax value should be. If you're performing at-market, a small tax increase could simply track the increased vale of your building. However, if you aren't doing the same as your neighbors, the Atlanta GA tax assessors could end up overvaluing your building and leaving you with an unreasonably high tax bill. The first step in determining if this is the case is to compare your property to the market as a whole.
Sales Activity
Values in 2013 moved up almost across the board. According to data from Marcus & Millichap, values on a per unit basis climbed around 3 percent to just under $40,000 per unit. Looking at Costar-tracked sales between $500,000 and $50 million, we see an even stronger trend. 2012 saw 159 arm's length transactions with full data available, totaling $1.715 billion. Those transactions spanned 35,183 units, leading to an average price per unit of $48,754. 2013 was stronger with total sales of 192 properties spanning 42,086 units. The sales added up to $2.269 billion and an average price per unit of $53,911. The Atlanta GA tax assessors see this data along with continuing low cap rates and can use it to derive a higher value for your property.
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Operational Metrics
Like their counterparts throughout the country, the Atlanta GA tax assessors also closely track the performance of apartment buildings in terms of their rent and occupancy, since that can help him derive a net operating income. 2013 was another strong year for Atlanta
In 2012, the average effective rent in Atlanta was around $825 per month. 2013 saw it grow aggressively to between $860 and $865. 2014 promises even more growth with effective rents potentially reaching $892, according to national apartment broker Marcus & Millichap. When the Atlanta GA tax assessors do research, they will see that occupancies are also increasing. 2012 saw market wide vacancy of 7.6 percent that dropped to 7.2 percent in 2013. 2014 brings projected vacancies of 7.1 percent, and the market is doing it in the face of the 6000 units constructed in 2013.
The Bigger Picture
Macroeconomic conditions make it easy for the Atlanta GA tax assessors to justify higher values for apartment buildings. Jobs are a major driver of apartment performance, and Atlanta is projected to add them in spades. Furthermore, the good news isn't concentrated in one part of the metro. Buckhead and Midtown remain desirable while the Central Perimeter submarket is experiencing significant job growth. New logistics operations south and west of Atlanta are driving demand for lower end units while the relocation of the Atlanta Braves stadium to suburban Cobb County will drive development and multifamily supply and demand for years to come.
Given everything that is happening in Atlanta, the good news is that you may be able to afford to pay high property taxes. The better news is that the appeals process set out by the Atlanta GA tax assessors means that you might not have to. If you don't agree with the estimate sent to you by your Atlanta GA tax assessor, we can help. We represent property owners through appeals with the various Atlanta GA tax assessors and help lower their tax bills.
