The turning of a New Year is a dramatic reminder that the holidays are over and the “tax man” cometh. Regardless of your political affiliation, we’ve never heard a wealthy, real estate investor brag about how much they get to pay in property taxes. Most of our clients understand the societal benefit of real estate taxes but still want to minimize their “fair share” within reason.
Tax notices are delivered by the Denver County Assessor every January, and if you have owned apartments for any length of time, you know that your valuation results from a Multiple Regression Analysis completed long before that tax notice arrives.
Many of our clients call, text, or email us “fighting mad” during May of an “odd year’ (e.g. 2019) that their valuation went up so much in a two-year period. Like a UFC title fight, owners engage in a 3-round tussle with the Denver County Assessor’s Office. We thought it would be fun and helpful to provide you with results through the analogy of a 3-round MMA bout.
45-75 S. Washington Street (Above)
Round 1 (May-June 2019): Property Value Protest. 54 protests had to be submitted, in writing, on or before 6/3/2019. It felt a bit like a college term paper was due; there were a lot of early mornings, late nights, and weekends spent reviewing comparable sales to create the best argument for our clients. Then you wait until August to hear how you did.
Round 2 (September 2019): Appeal to the Board of Equalization (BOE). A few clients received a Notice of Determination in August stating that our written protest resulted in a successful valuation reduction. However, the vast majority wanted Calibrate to file an appeal which resulted in a hearing with the Board of Equalization. I presented 41 back-to-back hearings on 10/7/2019 lasting 7 hours at the Assessor’s Office. It was an efficient and productive day defending our clients’ position.
After six months of exchanging blows, 25 Calibrate clients (46%) received reductions totaling $75,000,000!
Round 3 (November 2019): Petition to the Colorado Board of Assessment Appeals (BAA). 29 Calibrate clients were left and 17 “tapped out” not wanting to expend any more time, energy, or money on the process. The remaining 12 decided to file a petition with the BAA. As of this writing, we have received confirmation that only 4 of 12 hearings have been set for June 2020! The remainder will be set for later in the year. This is obviously an endurance sport.
With such a lengthy process, why do our clients ask us to help them every two years? Because it works.
*Owners of 15 properties, Our Happy Clients, David and Heidi with Kyle during a past interview.
You could choose to focus on the 50:50 failure rate and throw your hands up in the air. The reality is that many of our clients were satisfied. The most dramatic example is a local family. They own 15 Denver apartment buildings and we protested many of their values. In one case, we believed that their 70 unit apartment complex was over-valued by $2,789,100 and we were right! This reduction resulted in a tax savings of $28,762.84 spread over the next two years!
Tale of the Tape:
54 protested to the Assessor (June 2019)
25 received reductions (August-September 2019)
12 appealed to Board of Assessment Appeals (November 2019)
17 denied and chose not to move forward (October 2019)
by Kyle Malnati