Question Details

Johnmdriskill, Home Buyer in San Antonio, TX

Noticed many homes are priced significantly higher than their tax assessed value. Is that just what they are going for or are they just overpriced?

Asked by Johnmdriskill, San Antonio, TX Mon Dec 19, 2011

Moving to San Antonio, TX and looking for homes on East side of town. I have been looking at price/square foot averages and some seem to be way overpriced. Guess this might be due to the owner maybe being upside down on his mortgage or something.

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Hi, Most of the time the tax assessed value isn't fair market value because they aren't re-visitited on an annual basis. The amount they use to take the property doesn't represent the true value because it hasen't sold yet. This is why there are alot of tax grievances happening.

0 votes Thank Flag Link Mon Dec 19, 2011
A property's tax assessment has nothing to do with the value of a property.

Even in areas where the assessment is supposed to reflect the fair market value, the assessments don't. Forget assessments.

Also, don't pay much attention to price per square foot. That's nearly as inaccurate as assessments. The reason: Price per square foot doesn't reflect most of the things buyers are interested in. It doesn't reflect condition of the house. Age of the house. Style of the house. Size of the lot. Proximity to schools or shopping. Access to public transportation. It even doesn't accurately reflect number of bedrooms and baths. (There are 1,500 sq. ft. properties out there that are nice 4 bed/2 bath homes. There are others at 3,000 feet that are very large 3 bed/2 bath homes.) I even wrote a blog on the subject:…

So: Ignore assessments. And pay minimal attention to price per square foot.

So, then, what should you look at? For values, look at real comps. For the home you want, once you've narrowed it down, look at the things that matter the most to you--whether it's a large lot, or a good school nearby, or a newer home. Whatever. Your choice.

Hope that helps.
0 votes Thank Flag Link Mon Dec 19, 2011
Don Tepper, Real Estate Pro in Burke, VA
Access to public records has attributed to mass confusion regarding the value of a home. Assessed value is a price the town uses for property tax purposes only. It is not the price upon which a home should sell. A local realtor who monitors the market would have a much better handle of what the value of the homes are.

Please do not pay attention to assessed value. It will only frustrate you and deter you from purchasing the home you find that meets your requirements.
0 votes Thank Flag Link Mon Dec 19, 2011
That is common, all over the US. I don't like my customers to look at assessments without some prior understanding first; they can be led astray so easily. I even did a blog on how they can mislead you. I can send it to you off-line if you wish.

When the dust settles, what any property is worth is what a willing buyer and a willing seller agree to. Anything else, appraisals, CMAs, assessments are just trying to anticipate that. The assessments, however, have other purposes which can cause them to vary considerably from true markeet value. I have also seen them higher than the selling price, though that is less common.

And then there is human nature. Homeowners want a low a value assigned to their home as can be (until they are ready to sell, of course), thinking that the lower it is, the lower their taxes will be. It doesn't quite work that way, but that's another story. They often put pressure on their assessors to lower their assessment and often assessors do this to keep the peace. It happens all over.
0 votes Thank Flag Link Mon Dec 19, 2011
Tax assessments have nothing to do with what a current market value is on a home. Often communities only assess properties every 5 years, often values are not in liine with market value. Other communities assess at a doifferent value and use say 110% of 120% of assessed value for tax purposes. Nothing beats a buyer broker who can easily assess what the house is worth in todays market and guide you through with what its value is. If you need help in San Antonio I know one of the best agents in San Antonio and she can definately assist you if you like. Just send me an email and i can forward you the info.
Web Reference:
0 votes Thank Flag Link Mon Dec 19, 2011

A commonly misunderstood concept......

In many locations the assessed value of a home has nothing to do with the home's actual value. The assessed value is a number applied to property for the purpose of generating taxes equally and fairly.

0 votes Thank Flag Link Mon Dec 19, 2011
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