Many town assessors in Waldo County chose not to change assessments this year based on the housing market because they are unsure whether market rates will remain high. The city assessor is reassessing properties using values from before the pandemic.

Maine is experiencing an unprecedented increase in property values that appears to be related to the pandemic, according to assessors in the county.

Islesboro Assessor Vern Ziegler said it is difficult to know how long the housing market will remain high. It is not possible to know if we are in a housing bubble “until the bubble bursts.” He started selling real estate in the ’70s, before he became an assessor, and said he has never seen a market like this before.

He also serves as assessor for other towns and is the assessors’ agent in Lincolnville. He is seeing increased house prices in all the towns he works with. “It no longer shocks me, I guess is the best way to put it,” he said

Assessors determine the value of houses, he said. They calculate a property’s value based on prices of comparable properties in a town. They also use cost tables for lumber, plumbing and other house fixtures to determine a home’s value.

The state assesses each town’s overall property value. Towns can assess properties at no less than 70% of what they sold for, Ziegler said. This gives assessors leeway with swings in the real estate market. Assessors are not obliged to “follow the fleeting fancies of the market.”

Court precedents allow assessors to consider market trends to avoid wild swings in value from year to year, according to short-lived high or low sale trends in the market, he said. For now, he is valuing properties according to the pre-pandemic market.

Belfast conducted home revaluations from 2017 to 2020. It finished land revaluation and cost table revaluations this year, but interim Assessor Avis Winchester did not use the current market rates, which have increased since the start of the pandemic, she said.

A lot of people from out of state are buying property in the area for prices that are “way over assessed values,” she said.

Comparing recent sales with assessed values was an “eye-opener,” she said. One waterfront Bayview Street property was valued at $428,100 and sold for $770,000 this year. A property on Highfield Lane assessed at $282,100 sold for $440,000.  A home on Park Street assessed at $283,700 sold for $455,000. All of these properties were assessed at much less than the state-required 70% of what they ultimately sold for.

The city revalued houses within the bypass in 2017 and rural houses by tax map in the following years, she said. This year properties had to be revalued using updated market rates for construction and other cost tables, as well as land values. Previously, the city was using cost tables from its last revaluation in 2003.

There are about 4,000 real estate accounts in the city, according to Winchester, and 29% of them saw their taxes go down or stay the same. Another 49% of property owners saw their taxes go up by 2% to 10%. About 800 taxpayers saw their taxes increase more than 10%.

The revaluation added over $69 million to the city’s assessed valuation, she said, which dropped the mill rate from 23.3 last year to 22 this year. Despite the lower mill rate, some homeowners saw an increase in their property taxes because their homes had extra bathrooms, a finished basement or other furnishings that might have increased their value considerably.

Zeigler said he does not know what is going to happen with the real estate market in the next year or two, but if prices remain high over the next few years, he will have to start valuing properties according to the increased prices.

“If it keeps going like this, in a year or two then we’re going to have to say, ‘Well I guess this is the market.’”