This is one of those questions where the answer really depends on WHO you ask! The seller wants the value to be as low as possible...since this is the amount that their TAXES are based upon. The buyer however, looks at this number differently. So the question beomes:
How Important is My Assessed Value? In some areas, the assessed value used to be a good indicator of the market value of a property. However, this is not always the case. There are many homes in Cedar Rapids and Marion that are over-assessed. Meaning that the homes in the area are selling for much LESS than the tax assessed value.
If you are planning to sell your home, you need to make sure that the tax assessor site has the correct information about your home. Many times, the assessor has incorrect information including the number of square feet finished. If you finished square footage in your lower level and you did not obtain the proper permits, the assessor probably is not taxing you correctly! I know that is not what you want to hear! But the good news is, the new tax value will take over a year to take effect.
Since the tax information and assessor information is public, this is one of the easiest ways for buyers to compare properties. If you feel that you are over-assessed based on the homes that have recently sold in your neighborhood, you should take advantage of the opportunity to petition to lower your taxes. There is only a small window of time in which you can do this, so you will want to check with your local tax assessor to find out what needs to be done.
Just remember that there are four different people that determine the "value" of your home. And they all have different ways of determining that value.
1. You-You have an opinion on the value of your home. You know what you have spent to maintain and upgrade your home and you inevitably compare your home to others that have sold in your area.
2. Tax Assessor-The assessor wants this value to be as high as possible to raise revenue for the city and county. They can make the process of petitioning this value extremely difficult for homeowners.
3. The buyer-Buyers use the information that they obtain from public sources as well as the market analysis that their buyer's agent prepares for them to determine what they think they should pay for your home.
4. The Appraiser-Unfortunately, this is the only value determination that really counts when you are trying to sell your home. The lender hires the appraiser to make sure that the loan is a good "investment" for the bank to make.
So you need to sell your home 3 times:
To the agents to show it, to the buyers to feel it is a great value, and to the appraiser to make sure that the lender is making a sound investment.
Without the appraiser's value, the lender will not allow the buyer to borrow the money needed to pay the value that they were willing to pay for your home. This is why it is so important to price your home properly. The appraisers have become very strict and there is not much room for negotiation. In fact, the loan originators and agents have no ability to communicate with the appraisers at all. We are at the mercy of the lender and their instructions to the appraiser.
So try not to pay too much attention to your assessed value. Whether it is lower or higher than the current market value, appraisers do not use it to determine the value. Call me today to get your home ready for today's marketplace or visit my website at www.KarenFeltman.com today!
Keep smiling!
Karen
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