When working with buyers, often, when deciding on a purchase price offer, the buyer will look at the assessed value, not knowing the difference between assessed and appraised. Although something to consider, there are many variables to consider. One being what the apprasied value might be. I found this great article on Zillow which helps explain the difference in a very simple way.
Many people confuse assessments and appraisals. An assessment is the value placed on a property by the town or city's assessor's office for the purpose of determining the property tax due. An entire town will be assessed during a 4-12 month period with values determined by a team of qualified assistants after viewing properties and interviewing owners. The combined assessed value of all the town properties is then used to calculate what the tax rate will be. Each year the town may re-evaluate the tax rate to obtain the monies needed to run the town based on that combined assessed value. So tax rates may change from year to year but assessments usually do not. Only when assessed values become so outdated as to cause tremendous inequities between properties will a town reassess. The need to do a new assessment must warrant the expense. In some states, homes are reassessed each time they are transferred (sold), but that is not true in most New Hampshire towns. An appraisal is a report done by an appraiser to determine value. The appraiser will use recently sold prices of similar properties making adjustments for differences between the subject property and the comparables. They will usually combine this "Market Approach" with a second method such as "Cost Approach" (determining the cost to rebuild) and/or "Income Apprcoach" (used on properties that produce income) to determine Value. Appraisals are done most commonly when a property is to be financed or refinanced, but may also be requested for a variety of other reasons. Assessed value and appraised value will usually not be exactly the same on a property as the appraised value takes a snapshot in time and will be impacted by market activity.
Author:Michelle Federman Phone: 267-980-7653 Dated: February 13th 2014 Views: 5,061 About Michelle: Michelle Federman is a Philadelphia native. She worked for years in her family’s business, where s...
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