My Predictive Value Model relies on many sub components. I have already talked about the CMA and the Median Tax Search, they are extrapolated values from recent closed sales. Today I will add a third historical piece, but before I do, I wanted to let you know that I will shortly discuss searches that involve 
currently active homes and that also project forward.
Today I want to add the Percentage of Assessed Value Approach. This is a little labor intensive, but adds another estimate of value to further reduce the margin of error.
At this point in your analysis you should be able to establish a reasonable value range for the subject property, let’s say that number is $600,000. The range I would use would be $500,000 to $700,000. Use roughly plus or minus 10% of your subjects predicted value. Grab all the properties that have closed in the same tax district for the past 6 months, and their tax records. You will need the assessed value for each closed property.
If the assessor site you’re using does not provide the assessed value you can use the equalized value, adding back the exemptions and dividing that number by .3333. (This is for Illinois) Note that in Illinois we assess in arrears so make sure you are comparing the correct assessment years. Once you have the assessed value, divide the sales price by the assessed value and you will have the percent of assessed value. Repeat this for all the closed matches and use the median value.
You need to be careful here and make sure that you are aware of anomalies. A new home in Illinois can have a very low value because it has not been fully assessed. A total rehab can also skew your data. You should have a multiplier at this point. (as an example .69). Find the assessed value of your subject (Say $645,000 X .69 = $445,050). In this example the Percentage of Assessed Value would be $445,050.
There are some nuances to this approach, such as splitting the building and land assessments or using a twelve month search, but if you use the twelve month search, I think you should compensate for monthly loss or gain of value. Next time....The Median Active Sale with List to Sale Percentage Applied.
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