The value of real estate in Alexandria this year has increased by $1.45 billion, a 4.4 percent increase from 2006, according to real estate property assessments released this week.

The total value of real estate in the county is now estimated at $34.24 billion, according to the city.

Of the increase, more than 49 percent resulted from new construction in the city. The remaining 50 percent — $736.7 million — came from increases in the value of existing properties.

Real estate property assessments are used to determine the amount of real estate tax owners have to pay. They can be challenged by property owners.

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In fact, the city is currently in a legal battle with the federal government over the value of the property where the Patent and Trademark Office headquarters is located. The government and the owner of the property claim the property was overvalued by $500 million in 2004.

The increase in property value was not helped by weakening residential property values. The value of residential property fell $166.2 million, from $20.37 billion in 2006 to $20.21 billion this year.

The average value for attached residential homes and condominiums fell 2.9 percent to $509,593. Detached homes and town houses saw their values fall 1.26 percent to $660,866.

This is the first time in six years that residential home prices in Alexandria have fallen. From 2001 to 2006, prices went up an average of 15 percent each year.

Overall property value was buoyed by Alexandria’s commercial sector. Commercial property values went up by more than 13 percent — or $1.54 billion — to $13.18 billion.

More than $291.7 million of this increase came from new construction, with appreciation on existing real estate accounting for the $1.25 billion balance. Existing property value increased by nearly 11 percent.

dfrancis@dcexaminer.com