As certified real estate appraisers, We Want You to WIN your Property Tax Appeal! We will GIVE YOU BASIC RESOURCES FOR FREE so you can SEE if you have a Case! Visit https://propertytaxax.com for more information.
Are you overpaying your property taxes? Flushing thousands of dollars down the toilet over the years and not knowing it? Do you have a case?
FACTS are that 40% – 60% of homes in the U.S. are over-assessed. They have been victims of hastily done, on-the-cheap, “rush job” appraisals and are full of mistakes!
HUNTING FOR COMPARABLES
You’re contesting a property tax based on the value of comparable homes sold within 12 months of your assessment notice. A blanket assessment places a value on a home. It happens yearly, or it could be every 5 or 7 or more years.
Finding houses similar to yours that sold at or before the required assessment date. This is easily accomplished by visiting your local real estate office, and browsing expired multiple-listing books.
You must find three comparable properties most similar to and near your property. Most real estate offices are friendly, looking to build goodwill, and will generally be receptive to your plight. You may be a source of future business to them and help them gain a listing with a favorable recommendation.
The real estate agent will guide you to the appropriate information in the Multiple Listing Service (MLS) “Sold” books. The MLS books will contain photographs of the property that sold and detailed descriptive data about the sold listing.
You have to look in the sold section of the expired listings to find listings similar to yours. Pay special attention to properties with an equal number of rooms, bedrooms, and baths to yours and share a similar neighborhood or are in the vicinity of the one in which you live.
The more closely the comparables resemble the subject property (your property), the more credible your basis for an adjusted valuation will be. If, for instance, you live in a lakefront home, find other lakefront houses with which to compare. Try to find as many recently sold, similarly designed homes comparable to yours as you can.
Comparing Home References
Refrain from comparing a 1-story ranch to a 2-story colonial. Compare ranches to ranches, bi-levels to bi-levels, and colonials to colonials.
After you have found the information you need, ask to photocopy these three properties for further reference. Also, photocopy many extra similar properties for further reference because, as you scrutinize your information, you may find something previously overlooked and may need to find another comparable more identical to your property.
Real estate agencies will host an open house to expose better the homes they have contracted to sell. Usually, they will have a data sheet for attendees describing the house and property, a survey, and a list of the home’s selling features. You can scrutinize features similar to or different from your home, and when the house sells, you can use it as a comparison.
Concentrate on finding comparable sales with characteristics similar to your home’s. Various parameters are listed below in descending rank of importance, the first listed being more critical than the last.
Categories of Compatibility: Real Estate Valuation Categories for Compatibility
• similar neighborhood
• total square feet of living space
• number of rooms, bedrooms, and baths
• sold within 12 months before the annual assessment date, preferably within four months of it
• sales price within the general market price of the subject
• real estate sales or financing concessions
• location
• quality of construction
• style house
• age of house
• condition
• sq. ft. property site and view
• functional utility
• number of garages
• swimming pool, fireplace(s), remodeled kitchen, kitchen equipment, etc.
• storm windows re, placement windows, or thermopane windows
• basement, i.e., finished, unfinished, or none
• deck, patio, porch, etc.
• similar landscaping
THE ADJUSTMENT PROCESS
PROBABLE PRICE
An appraisal is an opinion of value, an estimate of worth. The Federal National Mortgage Association (FNMA) states, “Market value is the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeable and assuming the price is not affected by undue stimulus.” Valuation of residential real estate is estimated by comparing the subject with similar properties sold recently. Look at your neighborhood to find comparable sales or properties in similar neighborhoods that share similar characteristics of lifestyles, income level of residents, surroundings, average age, and value of houses.
Neighborhoods have boundaries and barriers to the next neighborhood, which may signal an abrupt change in lifestyle, i.e., railroad tracks, freeways, highways, major traffic arteries, lakes, rivers, mountains, etc. Political boundaries are created for government purposes, such as school districts, assessment districts, zoning districts, and city limits. In your neighborhood analysis, you may consider recreational facilities common to your situation. The focus is to find comparable homes in similar neighborhoods for your analysis.
ADJUSTMENTS: Real Estate Valuation Categories for Compatibility
Because properties are seldom alike, it will be necessary to make adjustments between the comparable and subject properties (your property). This process equalizes the properties in the comparison. An adjustment is “a decrease or increase in the sales price of a comparable property to account for a feature that the property has or does not have in comparison to the subject property.”
In other words, the comparable properties are adjusted to reflect the value of the subject property. You never change the value of the subject (your own home). If two houses were identical in every way except that the subject (your house) had a deck and the comparable did not, the value of the comparable would be adjusted upward.
Real Estate Valuation Analysis
Take time to browse market analysis pages (found in the course) to become familiar with the sample market analysis layout. By this method, the subject (your house) reflects more value when compared to a comparable home with deficient items (such as no deck or no garage). Remember: equivalent sales home value must be adjusted, not the subject property. The subject property is the standard against which similar sales are evaluated and adjusted.
Thus, if an item in the comparable property is superior to that in the subject property, a minus (-) adjustment is required to make that item equal to that in the subject property. Conversely, if an item in the comparable property is inferior to the subject property, a plus (+) adjustment is required to make that item equal to that in the subject property.”
In other words, if a comparable sale property has a significant improvement that your property does not have, make a minus adjustment. On the other hand, if you enjoy a major improvement and the comparative sale property does not, make a positive adjustment.
Round off adjustments to the nearest $100. Your adjustments are based on market data and supported by market evidence. Visit https://propertytaxax.com for more information.
