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Our Town by William Kelly: Palm Beach’s market value hits record $55 billion

Palm Beach’s total market value has soared to a record high of $54.9 billion, according to recent data from Palm Beach County Property Appraiser Dorothy Jacks.

That’s an increase of more than 10 percent since last year, when the total market value on the island stood at $49.6 billion.

Among the county’s 39 municipalities, Palm Beach is second only to Boca Raton, which continues to have the highest market value, at $56.9 billion. But Boca Raton has more than 44,000 parcels – more than quadruple the 9,265 parcels in Palm Beach.

The market value of Palm Beach County, including all municipalities and unincorporated land, increased by about 9 percent to $514.1 billion. That is second only to Miami-Dade among the state’s 67 counties.

Market values are continuing to rise throughout the county, though not as much as in recent years, according to Jacks’ June 26 estimates.

The market value or “just value” is what appraisers believe a property would sell for in the open market. It includes properties that are not subject to real estate taxes, including government buildings, schools, religious institutions and charities.

Homestead exemptions are not figured into market value.

The market value is significantly higher than a property’s taxable value, which is the figure taxing authorities rely on when setting the tax rates that determine how much owners will pay. The Town of Palm Beach typically collects about 18 percent of the property taxes paid in the town. The remainder goes to Palm Beach County, the county school district, and other taxing districts.

Each spring and summer, Jacks’ office releases an estimate of taxable property values to taxing authorities throughout the county to help them plan their budgets and set their tax rates.

Palm Beach’s total taxable value this year has reached $32.1 billion, an 11.3 percent jump over last year, Jacks told the Palm Beach Town Council at its July 9 meeting. After six consecutive years of lowering the island’s tax rate amid steep increases in taxable values, the council has decided this year to keep the rate steady at $2.61 per $1,000 of taxable value.

Taxable value is lower than market value for several reasons. State law caps annual increases in the taxable value of residential properties at 3 percent for those with the homestead exemption and 10 percent for those without it. About 60 percent of properties in Palm Beach are homesteaded.

In addition, Jacks said her office tries to set the taxable value of residential properties at about 85 percent of their true market value. That is done to steer clear of complexities associated with individual properties because the taxable valuations are computed en masse.

The taxable value of new construction in Palm Beach during the last year was $198 million, according to Jacks. That figure does not include projects still under construction.

Condominium values

Jacks said her office is closely monitoring the market values of oceanfront condominium buildings in the county. In the aftermath of the Surfside condominium collapse in 2021, those buildings are subject to a new state law that requires periodic inspections to ensure their safety. Some of the building associations have assessed owners to pay for multi-million dollar repairs and maintenance.

“Some buildings might not have collected reserves and possibly have not done as much maintenance over the years as they should have and are now seeing very heavy assessments,” Jacks said. “What we are watching is whether that affects the market for those condominiums.”

Some condo buyers may not be willing to pay top prices if they are going to have to assume the burden of a large assessment, Jacks said.

That issue is starting to show up in parts of the county, including Singer Island and South Palm Beach, Jacks said. But she said it hasn’t happened in Palm Beach.

“The good news is, your oceanfront condos are not showing that,” Jacks said. “You are not seeing that yet, but it certainly is happening around you.”

There are 6,225 condominiums in town with a market value of $10.4 billion and a taxable value of $6.8 billion, according to Jacks.

By comparison, there are 2,278 single-family homes with a market value of $38.2 billion and taxable value of $20.7 billion.

Commercial & Retail

Palm Beach’s commercial properties are doing well – especially its hotels, Jacks said.

Upgrades at The Colony hotel, The Chesterfield (soon to reopen as The Vineta) and at the White Elephant in the former Bradley Park Hotel building reflect a thriving market for luxury travel.

“We have watched with interest The Breakers buying up much of Royal Poinciana Way,” Jacks said.

The market for office space is wilting in many parts of the country, Jacks said. Not here.

“We are not seeing that here in Palm Beach County and certainly not here in Palm Beach,” she said. “Your vacancies continue to remain low, and your office rents continue to rise.”

Sales of retail properties on Worth Avenue, including the former Neiman Marcus building, and the renovation of the Royal Poinciana Playhouse building at the Royal Poinciana Plaza, reflect the healthy retail market on the island, she said.

There are 398 commercial properties with a market value of $2.8 billion and taxable value of $2.3 billion.

The remaining property categories are:

  • Multifamily (less than 10 homes): 102 parcels with a market value of $338 million and taxable value of $250 million.
  • Vacant. 162 parcels with a market value of $2.3 billion and taxable value of $1.7 billion.
  • Tangible. 851 properties with a market value of $208 million and taxable value of $179 million.
  • Other. 100 parcels with a market value of $626 million and taxable value of $163 million.

 
Property tax bills

Property tax bills are mailed out each year in November. Taxes must be paid by April 2025. Those who pay early receive a discount.

 

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