Why Property Tax Assessment Need To Be Review

Why 40 to 60 Percent of Properties Are Over-Assessed for Property Taxes and How to Address It: Overlooked Adjustment Categories to Lower Your Assessment

Property taxes are a major financial responsibility for homeowners. Calculated based on the assessed value of a property, they contribute to funding essential public services like schools, roads, and emergency services. However, it’s surprising to learn that between 40 to 60 percent of properties are over-assessed, causing homeowners to pay more in taxes than they should.

This article will explore the reasons behind these widespread property tax over-assessments and explain the overlooked real estate property tax adjustment categories. Additionally, we will outline the procedures for making adjustments in each category, helping you potentially lower your property tax assessment and save money.

Reduce property taxes for yourself or others considering property tax assessment errors.

Free property tax reduction training aids available.

1. FREE Mind Map for a Winning Property Tax Appeal = Winning steps that result in a win!

2. FREE Property Tax Adjustment Category Worksheet = All areas to target a reduction!

3. Free Access To All Comparable Sold Homes In Any Specific Area = Free Comps!

Access These FREE Resources by Clicking Here: https://access.propertytaxconsult.com

Many factors contribute to property tax over-assessments, including outdated data, mass appraisal methods, and reliance on inaccurate comparable sales. Below are the main reasons why property tax assessments are frequently inflated:

1. Outdated or Incorrect Property Information

One of the most common reasons for over-assessment is the use of outdated or incorrect information about a property. Property assessors might use data that is several years old, which fails to account for changes in the market, home condition, or even square footage. Home improvements that have not been factored into the assessment could also result in a misvaluation.

2. Mass Appraisal Techniques

Tax authorities often use mass appraisal methods to assess large numbers of properties at once. While this is an efficient way to process thousands of homes quickly, it lacks precision. A mass appraisal might not account for unique features of your property, such as its condition, location, or specific improvements, leading to inaccurate valuations.

3. Inappropriate Comparable Sales (Comps)

Many assessors rely on comparable sales, or “comps,” to estimate a property’s value. However, these comps might not be truly comparable to your property. For example, if a similar home in a different part of town sells for more, it could incorrectly drive up the assessed value of your home.

4. Overlooking Depreciation and Property Wear-and-Tear

Property values decrease over time due to depreciation and natural wear-and-tear. However, many property tax assessments don’t fully account for this, leading to inflated property values. Older homes with aging infrastructure or those requiring significant repairs are often taxed as if they are in prime condition.

5. Failure to Adjust for Market Declines

The real estate market fluctuates, and during downturns, property values often decrease. However, assessors may fail to account for these changes, especially in areas where property assessments aren’t updated annually. This lag in adjustment can result in homeowners paying higher taxes based on market conditions that no longer exist.

6. Limited Physical Inspections

Many property assessments are done without a physical inspection of the home, relying instead on estimates or records from past assessments. This lack of current, on-the-ground information can lead to inaccurate assessments, particularly for homes that have deteriorated or had their values impacted by environmental factors like flooding or storm damage.

7. Complexity of Property Tax Law

The complexity of property tax laws, which vary significantly from jurisdiction to jurisdiction, often leads to inconsistencies and errors in property tax assessments. Taxpayers, and even assessors themselves, may be unaware of potential adjustments or exemptions that could lower a property’s assessed value.

Overlooked Real Estate Property Tax Adjustment Categories

If you believe your property has been over-assessed, you have the right to challenge the assessment. By exploring overlooked property tax adjustment categories, you can potentially reduce your tax liability. Below are the key categories you should review:

1. Size and Square Footage Adjustments

The size of your home is one of the most fundamental factors in determining its value for tax purposes. However, inaccuracies in the measurement of square footage are not uncommon. If the assessor overestimated the size of your property, you may be paying more in taxes than you should.

• Adjustment Procedure: Review the assessor’s property description for discrepancies in square footage or lot size. You can have an independent appraiser measure the property to ensure accuracy. Present this evidence to the assessor and request a corrected assessment based on the actual square footage.

2. Condition of the Property

Property tax assessments often assume that homes are in average or above-average condition. However, if your property has significant damage or is in disrepair, the value should be lower. Homes that need major repairs, such as roof replacements, electrical updates, or plumbing repairs, may not be accurately assessed.

• Adjustment Procedure: Gather documentation of your home’s current condition, including photos, repair estimates, and inspection reports. Submit this information to your assessor to show that your home’s value should be adjusted downward to reflect its actual condition.

3. Comparable Sales (Comps)

As mentioned earlier, comps are often used to estimate a property’s value. However, the selection of inappropriate comps can significantly inflate your property’s assessed value. For example, if the homes used for comparison are in better condition or located in more desirable neighborhoods, your property may be overvalued.

• Adjustment Procedure: Research recent sales in your neighborhood to find comps that better match your property in terms of size, condition, and location. Present these more accurate comparables to the assessor as part of your appeal.

4. Depreciation and Aging

Over time, properties naturally depreciate in value due to wear and tear. This is particularly true for older homes, which may have outdated systems, aging infrastructure, or require repairs. Many assessors, however, fail to account for this depreciation, leading to inflated assessments.

• Adjustment Procedure: Review the age of your home and document any outdated features or necessary repairs. You may need to hire a home inspector to provide an objective report. Use this information to argue for a depreciation adjustment with the assessor.

5. Environmental Factors

Environmental factors, such as flooding, pollution, or proximity to high-traffic areas, can significantly impact property values. If your home is affected by such conditions, your property tax assessment may not reflect these negative influences.

• Adjustment Procedure: If your home is located near a busy highway, industrial site, or in an area prone to flooding, document these factors and how they negatively impact the value of your property. Submit this evidence to your assessor to request an adjustment for environmental conditions.

6. Neighborhood Changes

The overall condition and desirability of your neighborhood can play a major role in your property’s assessed value. If your area has experienced deterioration, increased crime, or a decline in public services, your home’s value may have decreased.

• Adjustment Procedure: Document any changes in your neighborhood that have negatively impacted property values. This could include higher crime rates, declining schools, or an increase in abandoned homes. Present this information to your assessor as part of your appeal for a reduced assessment.

7. Incorrect Property Descriptions

Sometimes, the problem is as simple as an incorrect property description. Assessors may list more bedrooms, bathrooms, or other features than your property actually has, or they might fail to account for certain limitations such as a lack of a garage or usable basement.

• Adjustment Procedure: Review the assessor’s property description for errors. If the description includes features your home does not have, such as extra rooms or amenities, provide documentation that corrects the record. This can lead to a downward adjustment in the assessed value.

Steps to Appeal a Property Tax Assessment

If you find that your property tax assessment is higher than it should be, you can appeal it through the following steps:

1. Review Your Property Tax Assessment

Carefully review the property tax assessment notice you receive from your local tax authority. Pay attention to the description of your property, the assessed value, and any comps used in the assessment.

2. Collect Evidence

Gather documentation that supports your claim for a lower assessment. This could include:

• Recent, accurate comps for similar homes in your area.
• Inspection reports or repair estimates showing the condition of your property.
• Photos of the home’s condition or environmental factors impacting its value.

3. File an Appeal

Each jurisdiction has its own process and deadlines for filing a property tax appeal. Typically, you’ll need to submit a written request for an appeal along with supporting documentation. Follow your local tax authority’s guidelines carefully to ensure your appeal is considered.

4. Attend a Hearing

In many cases, an appeal will involve a hearing before a tax review board. Be prepared to present your evidence and make your case for why the assessed value is too high. You can also hire a property tax consultant or attorney to assist with this process.

5. Receive a New Assessment

If your appeal is successful, you’ll receive a revised property tax assessment that reflects the correct value of your home. This can result in lower property taxes and potentially even a refund for overpaid taxes in previous years.

Learn more by clicking Here: https://propertytaxax.com

Conclusion

The fact that 40 to 60 percent of properties are over-assessed highlights the importance of regularly reviewing your property tax assessment. By understanding the common causes of over-assessment and the various adjustment categories, you can take proactive steps to ensure that your property is fairly assessed. Whether it’s correcting inaccurate square footage, adjusting for property condition, or accounting for neighborhood changes, challenging an over-assessment can save you significant money on your property taxes. Be diligent, gather evidence, and don’t hesitate to appeal if you believe your property is over-assessed.