Willie Stokes lives on a fixed income. His grandmother bought his Maple Street bungalow in the 1920s when College Park was a black neighborhood, self-sufficient, with its own businesses and culture. But when Stokes, 76, inherited the home in 2003, the neighborhood was crawling with drugs and crime. He’d wake up to find litter on the sidewalks and spent his morning walks scooping it up.
“Nobody would be cleaning up, sweeping in the street, but it was in my blood,” Stokes says. “I didn’t like seeing the trash all around.”
Since the city started buying homes in the neighborhood, he’s been on the front lines of another transformation.
Across the street sits one of the city’s “affordable” homes, valued for tax purposes at $262,000. Next door, there’s a two-story home, built in 2018, that’s already valued on the tax rolls at nearly double its $222,000 sales price.
Stokes’s house hasn’t changed much since he’s lived there. But because his neighborhood is becoming so much pricier, the government views the land underneath it as much more valuable. In fact, since the last time Wake County assessed property values four years ago, the value of his land has more than tripled, from $37,500 to $132,250 as of last week. (In 2016, the county decided to assess property values every four years instead of eight.)
This would normally mean a 50 percent hike in local property taxes, from about $585 per year to about $877. Stokes is fortunate; he qualifies for the state’s senior tax relief program and won’t see much of a change. But just 1 percent of city property owners qualify for this tax break. Many of his neighbors don’t—and the county’s revaluation could hit them hard.
Overall, Wake’s appraisals increased property values by about 20 percent, but the changes were unevenly distributed. Neighborhoods east of downtown Raleigh saw staggering increases driven by redevelopment. Modest houses were gobbled up by developers—or, in some cases, the city—and replaced by newer, bigger, costlier homes. The greatest demand in the market is for homes valued at less than $250,000.
“Forces of supply and demand are at play. High demand and low supply are going to drive up values,” says county tax administrator Marcus Kinrade. “The redevelopment is mostly driving up the lot values in residential areas east of downtown, at least 50 percent, sometimes 100 percent, sometimes more than 100 percent.”
In Quarry Hills, land values spiked 463 percent due to the revaluation. Nearby, the Carnage neighborhood saw lot values rise 445 percent. In College Park, land values increased by 360 percent.
The county is trying to reduce the impact by writing off the increase in building values in cases in which land values have skyrocketed, but the homes themselves haven’t been drastically improved. But most of the time, these property owners will pay more anyway.
In the aggregate, the revaluation is supposed to be revenue-neutral, meaning the revenue brought in would be about the same as it would be had the reappraisal not taken place—at least as a starting point for the county’s budget deliberations this year. But revenue-neutrality doesn’t apply to individual properties, which means that those in rapidly developing neighborhoods will see their tax bills climb, while people in neighborhoods whose values have risen less than 20 percent will pay less, says county commissioner Matt Calabria.
East Raleigh community activist Octavia Rainey sees the process as another piece of the systemic gentrification of her neighborhood. The tax hikes mean lower-income residents who are ineligible for the senior tax relief will face a difficult decision: “Are you going to keep the property or do you just sell it? For the people who own their houses, they are trying to figure out what to do,” Rainey says. “East Raleigh is really suffering from this tax increase. You have people who live in the redevelopment areas, and they can’t afford to pay their taxes. The city is gonna have to deal with that.”
One idea is to adopt a grant program similar to Durham’s, in which longtime residents in revitalizing areas making below 80 percent of the area median income can apply for funding assistance to offset their tax increase.
City council member Nicole Stewart calls the assessment hikes in College Park “startling, but I also think not terribly unexpected. We’ve been hearing community members say this for a long time, that we need to balance the need for affordable housing without putting that burden back on taxpayers,” Stewart says. “It’s going to be a huge balancing act over the next four years.”
Contact Raleigh news editor Leigh Tauss at firstname.lastname@example.org.
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