In recent years, the real estate market has experienced unprecedented growth, with property values rising steadily. As of the 2025 reassessment valuation date (October 1, 2024), prices had not yet shown signs of declining. The Borough is required to conduct annual reassessments to ensure a fair distribution of taxes, aiming to reflect rather than predict market conditions. While the current higher interest rate environment may impact property values in the future, assessments are still adjusting to this recent period of historic appreciation. The evolving real estate market highlights the critical role of the assessment process, which serves as the foundation for distributing county, school, and municipal tax levies.
Under the New Jersey constitution, annual tax levies are distributed based on market value. Contrary to common belief, property assessments do not generate taxes; they only determine how they are distributed. However, many municipalities in the state still rely on periodic “snapshot” assessments, which fix tax distribution based on a single moment in time, often for 10 or 20 years. Without proactive annual adjustments, tax distribution becomes increasingly inaccurate as time passes (see Exhibit A). This static approach incorrectly assumes uniform appreciation or depreciation across all properties, which does not reflect the diverse realities of real estate markets. In the Borough of Deal, for instance, different property types and price points exhibit varying growth rates. Annual assessment maintenance is therefore essential to uphold tax distribution fairness, as required by the New Jersey constitution.
For the 2025 reassessment, adjustments were made to the global assessment model to target current market values. Individual property, neighborhood, and submarket assessments were also refined to enhance accuracy. The reassessment aims to align with 100% market value, thereby improving statistical measures of accuracy. For the upcoming 2025 tax year, the total aggregate property value in Deal will be 13.81% higher than in 2024. Consequently, most property assessments will increase to reflect this growth; however, this does not mean a corresponding 13.81% increase in taxes.
Instead, it reflects the rise in overall property values in the Borough. Due to the inverse relationship between the aggregate property value and the tax rate, higher assessments typically lead to a lower tax rate. We anticipate that the 2025 tax rate will be lower than in 2024, thanks to the increased property values (see figure 7). This report provides an overview of the reassessment and its implications.
Erick Aguiar, CTA
Assessor
