 Home Buyers
Tips Archive
Questions Most Asked
Assessment
Is the assessed value of a property a good benchmark to
use in determining whether the selling price is reasonable?
The assessed value will tell you
what the property tax bill will be, but it’s not necessarily a reliable indicator of
the current market value.
For one thing, you don’t
know when the property was assessed last, and it is possible that market conditions
(and thus market values) have changed since then.
Also, although state law requires
that all properties be assessed at 100 percent of value, assessing standards and assessing
practices vary from community to community.
Some properties are assessed
accurately, but some are over-assessed and some are under-assessed, and there is no easy
way for you to determine where this property fits on that scale.
A low assessment may not reflect
an upgrade completed since the last valuation; a high assessment may trigger an abatement
request that hasn’t yet been filed.
A property’s assessed value
is what the local assessor says it is. To be sure, the assessment must be based on
objective criteria that include (but aren’t limited to) what other buyers have paid
for similar properties. Market value, on the other hand, is defined as what a
willing buyer will pay a willing seller, and it is entirely possible that the prices
buyers are willing to pay today are different from the older sales prices on which the
current valuation is probably based. You’ll find that recent sales of
properties comparable to this one, and a knowledge of the current demand for properties of
this type in your community, will produce a far more accurate reading of current market
value.
This Tip was excerpted from:
Q & A by Nena Groskind, The Boston Sunday Globe, Boston, MA, 5/11/97
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