Assessed value
The figure your county uses to calculate your tax — not what your house is worth.
The assessed value is the number your taxing bodies multiply by their rates to produce your bill. It is set by the assessor, not by the market, and it is the number an appeal actually contests.
In many states it is a fixed percentage of market value rather than market value itself. If your state assesses at 33.33%, a home the assessor believes is worth $300,000 carries an assessed value near $100,000. Comparing that $100,000 to what your neighbour sold for is meaningless until you have converted one into the other.
The most common and most expensive mistake in this whole process is reading the assessed value as an estimate of what the house would sell for, deciding it looks low, and never appealing. Divide by the ratio first; then decide.
Related
- Assessment ratio — The percentage of market value that becomes your assessed value.
- Market value — What a willing buyer would pay a willing seller, neither under pressure.
- Equalized assessed value (EAV) — Assessed value after a county-wide multiplier is applied.
Property tax is state law and the details differ. For what applies where you live, see coverage by state and your appeal deadline.