It’s important to understand your home’s value since it directly affects your net worth. It also is essential to know how much you would receive if you sold your home since it will influence your financial decisions in the future. However, know that there is a distinction between your home’s market value and it’s assessed value.
The market value of your home is calculated by determining what your home would bring in if it was sold in the current housing market. Because of this, the market value of your home can fluctuate drastically depending on the economy, the state of the housing market in your area and the value of surrounding properties. Market value is not the same as the value a bank would assign to your home, it strictly refers to the amount your home would bring in if it sold tomorrow.
Although market value and assessed value are not the same, the market value is a factor in determining your home’s assessed value. The assessed value is used to calculate your property taxes and is based partly on the laws and regulations of your town and county. Every state and county varies, but the average time frame of when homes are assessed is every five to seven years.
What if you disagree with your home’s assessment?
If you feel your home was unfairly assessed, contact your assessor’s office. There is a process to petition a reassessment, such as a tax appeal, so be sure you know your options. Always remember that an assessment is different than an appraisal, so unless you’re concerned for property tax purposes, there aren’t many reasons that warrant a re-assessment.
Property values can be a complicated subject, so if you have any questions regarding your home’s assessment, appraisal or market value, talk to a real estate professional. They will be able to help you navigate the process of challenging your home’s assessed value if you wish to do so.