Home Buying in Glen Burnie>Question Details

Tammera,  in Odenton, MD

We are closing on a home that sold for $229k and appraised for the selling price, but the 2008 tax accessment

Asked by Tammera, Odenton, MD Fri Jan 16, 2009

was $273,750. Do we have a right getting it reappraised and why is there such a difference in 08 versus 09?

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6
Understand that a tax assessment isn't a good indicator of a home's value. In fact, it's practically worthless as a home value indicator. So: Forget the assessment. Period.

The question is whether the house you're buying is worth $229,000. I hope/assume you had your agent run the comps on the property prior to your making an offer. And, in today's market appraisers tend to be conservative, so--without knowing your property at all--it's probably worth $229,000. And depending on the provisions of your contract, you can't use a low appraisal to get out of it.

Once you buy, the tax assessment should (in most areas it will) drop down to the price actually paid for the property. If it doesn't--if you receive a tax assessment based on its value after your purchase date and it's higher than your purchase price--then you appeal the assessment.
1 vote Thank Flag Link Fri Jul 31, 2009
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
Contact
Many Towns in New Jersey have Revalued for tax purposes and the Market has since declined, the assessments will stay the same. Since revaluations are done every few years the Assessor utilizes a ratio to value to determine the value each year. To determine whether your assessment is correct you need to know the current ratio to value, you can call the assessors office to get it. You divide the assessment by the Ratio and it gives what the assessors opinion of true value for that year. If the true value is still too high then you consider a Tax Appeal, this must be filed As of April 1, 2010. Once the appeal is filed you will get a hearing date, have an Appraiser complete a report (He or she must be qualified to testify as an Expert)
0 votes Thank Flag Link Sat Aug 15, 2009
Hi Tammera,

In general tax values are not equal to market value. For the past 10 years (prior to 2005) you would typically see the tax value be 50% or LESS of market value. When Anne Arundel County re-assessed properties between 2005 - 2007 we actually began to see some correlation between the two values, but since property values have declined pretty steadily it is now pretty much the norm for property market values to be less than tax values. It took them a long time to do those re-assessments a few years ago and since this could decrease the tax base I'm sure there is no short-term plan to adjust values and taxes downward.

Your Realtor is the best person to give you advice on current market values as they have access to all of the closed sales data.
0 votes Thank Flag Link Sat Aug 15, 2009
Ask your Realtor for assistance is preparing a list of recent comparable sales in your area to determine if you were unusually lucky to purchase the property below market value or if indeed the market value is declining or a little of both. At any rate, you do have a right to appeal your appraisal. Perhaps the existing appraisal is a year or more old and should be revised. The sale of one home does not change market value, however. Perhaps you purchased from a very motivated buyer who needed to sell. Market value is affected by, but not necessarily dictated by bank owned foreclosure and "distressed" sales. You must present your case for a tax reduction with facts that support your opinion. In Florida taxes are paid in arrears so the appraisal is based on the value in the past year. Is that the situation in MD also? If so you will have to consider that in your analysis. Your Realtor should be able to help. Throughout try to keep in mind that you are so lucky to be a buyer in these market conditions. Good luck.
0 votes Thank Flag Link Fri Jul 31, 2009
In the current market it is not unusual for properties to sell and appraise for less than the assessed value. For many years assessment values were lower than market value but there was a push over the last few years for assessed values to be equal to market values. In the last couple of years market values have dropped and assessed values continued to climb. Now, homeowners are appealling the assessments because they are often higher than market value in a time when they are meant to be more equitable. You may want to check with the Taxation Department and get information on how to appeal your assessment. No one wants to pay more taxes if they don't have to.
Good luck.
0 votes Thank Flag Link Fri Jul 31, 2009
Are you asking if you can get the home re-appraised or do you want to appeal the tax assessment? I am not sure what you would gain by having another appraisal done. If you are wanting to appeal the tax assessment, that is something you are entitled to do and you probably should if you can validate the reasons for the appeal. If you can show that the comps are significantly lower than the assessed value, you will probably win the appeal. On the tax assessment you received, there are instructions for the appeal process. If I can be of further assistance, please contact me at LDevnew@cbmove.com
Good luck!
0 votes Thank Flag Link Fri Jan 16, 2009
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