Real Estate Taxes and Tax Appeal Assessment Loopholes
In certain years a blanket assessment is enacted resulting in a re-assessment of property taxes. Often inaccurate “quick” values are concocted. Many times adjustment is enacted using a multiplier factor to adjust these values. Little time is allocated to this rendering of property value.
Appraisal companies bid for the blanket reappraisal contract for a community. The low bid wins the contract. Ask yourself if the bid allocation was $35 per home, how much time could be spent on that appraisal? Consider the appraiser has to make a profit for his effort further reducing the time allotment to appraise. Often college kids or those with little appraisal experience are employed.
Errors frequently occur when blanket appraisers do their job. Furthermore, if the original assessment was in error, employing multipliers to roll over previous years assessments is invalid.
If the building and tax department cooperated, there would be no need for a blanket reappraisal. Building permits and final market values could be incorporated into the individual values of homes with the tax role. There would be no need for blanket reassessment duplicating already established values.
A tax assessor has little time to appraise a home and usually do not engage in that activity. Tax assessors are often politically appointed and are not trained and experienced real estate appraisers. Their usual method of deriving value is based on a cost basis instead of a market value approach. The market value approach is based on what an informed buyer would pay for the home, not what it cost to build it.
Selling prices of homes are constantly changing. When appealing your property taxes, only market value holds weight. Your home must equal the current selling price of other comparable home in your area.
A huge amount of money is spent on blanket municipal appraisals. Sure they may catch the occasional patio or shed built without a permit, but that does not warrant the extra appraisal cost.
This spells out gigantic loopholes for homeowners. Doing a simple analysis of your home’s market value and seeing how it lines up with the appraised value can save thousands of dollars wasted on taxes.
