Property values in Otter Tail County rise up to 30% for 2022
All property types across Otter Tail County will see their estimated market values rise between 15-30%, according to an Otter Tail County Assessor's Office report. The county's chief deputy assessor said their new valuations are based on sales from the previous year and are entirely dependent on market forces.
Otter Tail County property owners can expect to see their estimated market values rise between 15-30% this year as they begin opening their tax assessments from the county, according to a report from the county assessor's office.
The higher valuations for 2022 across all property types are the result of property selling for higher prices last year, but while many residents may be scared of what their new sticker values may do to their property taxes, Kevin Scheidecker, chief deputy assessor for Otter Tail County, said the higher values doesn't mean their property taxes will go up.
"Just because your values are going up 15%, 20%, 30%, that does not necessarily equate to a tax increase of the same percentage," said Scheidecker. "(The Otter Tail County Auditor) sets the tax capacity rate based on what all these jurisdictions need to collect to satisfy their budgets."
Additionally, if property values go up across the county, the county auditor could lower the taxable capacity rate on properties based on jurisdiction, which could keep property taxes for residents at roughly the same amount even if their estimated market value increased up to 30%. It could also benefit homeowners who didn't see larger increases in their property value because, if their valuations were roughly the same as last year and the taxable capacity drops county-wide, they could actually pay less in property taxes.
"In my position, you start to look at, is it residential or seasonal properties? Is it commercial properties, is it industrial properties, is it (agricultural) properties? It's everything. Everything was going up," said Scheidecker. "It's what people are willing to pay for things, and we see lots of different things going on, and some we can put our finger on, like we know there is short supply, there's no inventory out there for certain types of property."
He also said one of the reasons for the short supply could be investors pulling their money out of the bank and stocks and putting it into property, because the return can be higher with the increasing values.
"What's my money getting me if I have it in the bank? Nothing," said Scheidecker. "Some of the accounts are 0% interest…so I'd imagine some folks are looking for a better investment."
Estimating market value begins with deciding what the value of certain types of land are, he said, adding that all of Otter Tail County’s land types saw increases in value, including irrigated land, which doubled in value from 2020 to 2021.
"When we do set values in our office, we start with those county-wide types of things first, like the tillable, the pasture, the woods, those site acres... That's where we start to see what kind of increases we need to do there first" said Scheidecker. "Farmers in the county know better than we do what the market is dictating on these things, so they aren't surprised that values are going up. They won't be surprised because they know what it's worth; they know what farmers are paying for it, and when that is going on, we have to come up accordingly. We had to raise those irrigated values, overall tillable values, and I don't think those folks will be at all shocked at what's going on."
The value of tillable land in Otter Tail County increased about $700 per acre, while highly wooded and high-grade pasture land increased $800 and $300 per acre, respectively.
Scheidecker also said the state requires the county to keep its estimated market values of properties within 90-105% of what homes actually sell for in that jurisdiction, which meant many properties needed to have their valuations increase.
Some of the biggest increases in valuations were lake properties. Across 207 Otter Tail County lakes, only 15 lakes saw their lakefront footage valuations stay the same from 2021 to 2022. The highest increases in Otter Tail County per lakefront foot were:
- Fish Lake — $3,600 per lakefront foot in 2021, to $5,900 in 2022.
- Otter Tail Lake — $3,200 in 2021, to $4,900 in 2022
- Pelican Lake — $6,400 to $8,000
- Clitherall Lake — $1,900 to $3,300
- Bigpine Lake — $1,700 to $2,900
- Jewett Lake — $1,600 to $2,800
- Rush Lake — $2,050 to $3,200
- West Battle Lake — $3,250 to $4,400
He added that last year's record home sales differed from the sales seen before the 2008-2009 recession because more cash is being offered at closing, along with larger down payments.
"It is a 'wow,' it is absolutely a 'wow' and we've all felt that," he said of the increases this year. "It is just almost mind boggling when you see what these values have done in that one year."
If residents have any questions, or would like to know their options to appeal their property assessments, they can contact the Otter Tail County Assessor's Office at: 218-998-8010.