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Asbury Park property values have increased by 20 percent over last year, according to a 2018 Assessment Report released Wednesday.

But that increase does not translate into a definitive tax increase, Tax Assessor Eric Aguiar said. Instead the figure represents the strength of the local real estate market.

“The City’s real estate market continues to be exceptionally strong with property value appreciation easily outpacing all surrounding communities,” Aguiar [at right] said in the written statement that will be mailed to property owners next week. “By and large, if the valuation increases, the tax rate decreases.”

This is because the increased valuation is used as a baseline in calculating how the tax levy will be divided. For example, if a property value has increased by 15 percent, using the 20 percent baseline calculation, the property tax will decrease.

But there is a wild card – the 2018 tax rate.

The actual 2018 rate will be calculated based on next year’s levy, which is then divided by the increased assessments.

“How much the rate actually decreases depends on how much the city has to raise through the tax levy,” Aguiar said. Assuming a stagnate levy, those whose assessments go up less than 20 percent would pay less taxes.

Those facing an increased tax share are owners of renovated properties and new development projects.

Hardest hit will be waterfront redeveloper iStar, whose combined property values have gone from $55 million to $92 million. Development projects now underway will drive their tax bill increases, Aguiar said. For example, the 1101 Ocean Avenue project [shown in featured photo] has gone from a $5 million valuation to $15.7 million.

Also seeing a hit, will be renovated properties with improved finished basements, kitchen and bathrooms, and increased square footage.

“The condition of a property is so important in this local market,” Aguiar said. Renovations could change an assessment by $200,000, thereby affecting its tax allocation since the distribution of a tax levy is based on market value.

In the end, 65 percent of the City properties will see a decrease in their assigned share of the tax levy.

“Ultimately it’s about the tax levy being distributed fairly,” Aguiar said.

The city has released a 2018 Reassessment Report and there will be a public Q&A meeting will be held 6 p.m. Nov. 29 in City Council Chambers, located at 1 Municipal Plaza.

By The Numbers:

The net valuation of the city’s properties will be increasing by $274 million; a 20.06 percent increase.

35 percent or 1,478 properties will pay a greater proportionate share of the tax levy in 2018 than they did in 2017.

65 percent or 2,730 properties will pay a lesser proportionate share of the tax levy in 2018 than they did in 2017.

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