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Even as the housing market shows signs of steadying after a pandemic-fueled frenzy, data centers continue to drive a steady increase in the overall value of real property in Loudoun County. The news means that county supervisors will have available a robust commercial tax base as they begin the budget development process for fiscal year 2024. Revenue from real estate taxes is the largest single source of funding for county services.
The fair market value of real estate in the county is now $129.9 billion, a 14.5% year-over-year increase, according to the results of the annual reassessment presented by Commissioner of the Revenue Robert Wertz and his staff at a board of supervisors meeting Tuesday.
The value of data center real estate increased by $6.6 billion, or 56%, last year, and data centers’ share of all real estate value in the county increased by 3.4%. Data center properties now account for $18.4 billion in fair-market value. These figures do not include the taxable value of the computer equipment housed inside the facilities, which alone generates more than a quarter of the county’s local funding.
The value of residential real estate also increased from last year, but at a much less torrid pace than data centers and other commercial properties. Existing single-family homes appreciated by an average of 7.5% and attached townhomes gained 5.9% in value. New residential construction added another $1.2 billion in taxable value.
Supervisors have steadily decreased the tax rate on real property in recent years even as county spending has increased; the real estate tax rate in 2015 was $1.205 per $100 in fair market value, falling to 89 cents by last year. This is possible in part because the overall value of real estate has increased faster than the tax rate has decreased and in part because revenue from taxes on data center equipment and other, non-real property has lessened the county’s reliance on real estate tax revenue.
County Administrator Tim Hemstreet will present his proposed FY 2024 budget, including proposed calendar year 2023 tax rates, to supervisors on Wednesday, Feb. 15 at 5 p.m.
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