Why Is the Tax Assessment So Different Than the List Price for This Home?
Scott P. Rogers
If you're checking out homes recently listed for sale, you might also happen to look up a property in the city or county tax records -- and then you might be surprised to see that the tax assessment is quite a bit different from the list price.
In most cases, the tax assessment is lower than the asking price.
In most cases, the tax assessment is lower than the asking price.
So why the difference?
A few key reasons...
Timing - Tax assessments are often based on sales data from a year or more ago. In a changing market, home values may have gone up (or down) since then.
Limited Info - Assessments don't always reflect upgrades, renovations, or the condition of the home. A house with a new kitchen or finished basement might be worth far more than the tax record suggests.
So, what's the key thing to remember?
Tax assessments help determine how much a homeowner pays in real estate taxes -- but they aren't a reliable way to understand a home's current market value. If we are trying to determine a home's value in the current market, our best bet is to look at recent comparable sales.
A few key reasons...
Timing - Tax assessments are often based on sales data from a year or more ago. In a changing market, home values may have gone up (or down) since then.
Limited Info - Assessments don't always reflect upgrades, renovations, or the condition of the home. A house with a new kitchen or finished basement might be worth far more than the tax record suggests.
So, what's the key thing to remember?
Tax assessments help determine how much a homeowner pays in real estate taxes -- but they aren't a reliable way to understand a home's current market value. If we are trying to determine a home's value in the current market, our best bet is to look at recent comparable sales.
