Whether you’re searching for your next home to purchase or considering selling your current property, your home’s assessed value is important to know through every stage of homeownership.
When tax assessed value matters & how to calculate it
The assessed value of your home is the estimate of your home’s worth in the current market, and this amount is what's used to determine your yearly property taxes.
As a homeowner, knowing your assessed property value can help you budget your money more effectively for property taxes and understand if you have enough equity built up to borrow a home loan.
If you purchased your home years prior and are considering selling the property, the current value has most likely greatly increased, so knowing the assessed price of your home can help when deciding how much to list your home for.
To calculate your home's assessed value, the market value of the home is multiplied by the decimal form of the assessment rate. The formula for this is:
Assessed Value = Market Value x (Assessment Rate / 100)
Assessments versus appraisals
So, what’s the difference between assessment and an appraisal? The appraised value of your home is how much the property is worth on the market whereas the assessment is the number used by your local government to determine property taxes.
During an appraisal, usually a state licensed appraiser is sent out by a mortgage lender to examine the property. During the examination they observe the foundation, structure, square footage, HVAC system and more.
For assessments, your local government hires professional assessors to use data about the home, including previous years appraisals, to determine the worth of the property and how much taxes need to be paid on the property.
The assessed value of your home is constantly changing due to market conditions. Staying up to date with this information can prepare you, regardless of what step you’re on in the journey of homeownership.
About the Author
Liliya Sherman
Liliya Sherman has been in the Real Estate business for a number of years. She's had great success and her clients are always satisfied. Liliya comes from a business background. She holds a B.S. in Business Administration. She is well organized and results-oriented. Having worked in the high tech industry, Liliya appreciates the importance of managing her and other people's time. She will listen to your needs and will do her best to match them with market opportunities. Liliya holds her clients' interests close to the heart. People who work with Liliya always feel as if they are her number one priority. Don't be left behind.
