FAQ #11 for Sellers: How Important is My Assessed Value?

By
Real Estate Agent with Cedar Rapids/Iowa City, IA KW Legacy Group S44645

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

 

 

Posted by

 

Karen Feltman, REALTOR®, ABR, AHS, CHMS,                                                                      CNE,CRS, e-Pro, green, GRI, SRES, TRC

Keller Williams Legacy Group

4850 Armar Drive SE Ste B

Cedar Rapids, Iowa 52403

Email: karenfeltman@gmail.com

Mobile  319-521-0701

www.KarenFeltman.com

Licensed in the State of Iowa

© 2010-2018 by Karen Feltman, Cedar Rapids/Iowa City Relocation Specialist 

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Jeffry Evans 04/08/2011 12:57 AM
  2. Tim Peterson 04/10/2011 10:27 PM
Topic:
ActiveRain Community
Location:
Iowa Linn County Cedar Rapids
Groups:
Active Rain Newbies
Realtors®
Iowa Real Estate
Addicted to Active Rain
Tags:
seller representation
tax assessment
taxable value
appraisal values
buyer considerations

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Rainmaker
45,690
Mindy Huls
EXIT Realty Hawkeye - Grinnell, IA
Broker/Owner EXIT Realty Hawkeye

Well put!!! I am just about to have a conversation with a buyer who thinks the assessed value is high on a property....which she is right, but will have to contest is after the purchase. We did have one of our buyers contest a value after the purchase and got it lowered. It was a process but worked out in the end.

Apr 07, 2011 04:29 PM #1
Rainmaker
528,812
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

@Mindy-It is great to hear that you are educating your buyer about the market value versus the assessed value.  You are a great advocate to your buyer!

Apr 07, 2011 04:41 PM #2
Ambassador
618,935
Pat Haddad, ABR, CRS, ePRO, GRI
Keller Williams Indianapolis Metro NE - Carmel, IN
Carmel, Fishers, Westfield IN Real Estate Expert

Karen--When I saw the topic, I immediately had to glance over to remind myself of where you are writing from.  Here in the Indianapolis area, there have been many home owners who have had to contest their assessed values and have them redone.  Not everyone knows they have this right.  Your series of posts are really, really excellent!

Apr 07, 2011 05:24 PM #3
Rainer
241,526
Michele Miller ~ REALTOR®, LMC, HSE, CHS, SRES, CMRS
ERA Key Realty~Worcester County Realty Group - Worcester, MA
'Helping You Make the Best Move"

Karen,

I love your FAQ! Thank you for posting these!

That's a question I get asked all the time. Assessed values are all over the board latelly. For me, I use it as a starting point for my CMA's but that's about it.

HAPPY FRIDAY!

Apr 07, 2011 11:55 PM #4
Rainer
36,481
Jeffry Evans
Temple, TX

Great stuff. I've often wondered how many buyers are savvy enough to take into consideration the tax assessed value, and if they believe it to be accurate. My experience tells me that often the value is not congruent with the market value.

Apr 08, 2011 12:56 AM #5
Rainer
106,897
Elizabeth Byrne
Keller Williams Realty - Arlington, VA
Arlington Virginia Real Estate

Karen, what a great topic. In my area, many homes are assessed under the market value - this creates confusion among buyers, who tend to make their offers too low. Now I know how to explain different "values" to different audiences. Thank you.

Apr 08, 2011 12:21 PM #6
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Rainmaker
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Karen Feltman

Relocation Specialist in Cedar Rapids, Iowa
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