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Using Trulia in Bloomfield : Real Estate Advice

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  • Local Info14
  • Home Buying20
  • Home Selling1
  • Market Conditions6

Activity 1
Mon Apr 2, 2012
My NC Homes Team answered:
There is no true set ratio. Market Value changes all the time, it's a reflection of what a ready, willing and able buyer decides their willing to pay for a property. Tax (or assessed value) is a point in time valuation and has absolutely no bearing whatsoever on market value. Most states require that properties be re-assessed every 4-8 years. (Each state is different, however as the assessment process is an expensive one, and so many states are suffering with budgetary restraints most will take as long a time in-between reassessments as possible). Most but not all, mandate that assessed value be 100% market value. While this sounds good, the problem is it's set for that year and then the market moves on and can go up or down.

It is important to understand there are three values to any property.
The most of important of which (for most people) is Market Value.

Market Value is what a ready willing and able Buyer (who is competent to enter into a binding contract) will pay for your property. This can be determined by a good local Realtor when they prepare a market analysis for you. You should let whomever you are speaking with your time frame for getting it sold. It’s a simple matter of supply and demand. A balanced market is 6 months worth of supply. Above that and it’s a Buyer’s market, below that a Sellers market. Depending on your motivation as a Seller you should price accordingly.

Appraised Value is what a licensed Appraiser feels the property is worth, this is the number a lender will use when a Buyer is looking for a mortgage. Appraised and Market values should be very close and ideally are identical.

Lastly there is Assessed or Tax Value. This is only important in terms of what a property owner will pay in property taxes. This number only rarely coincides with actual Market Value for the simple reason that they are a “point in time” number. Tax assessments are typically done every 4-8 years depending on where you live. Some States Like North Carolina mandate tax values to be 100% of market value, other do not. Regardless of what is mandated, the value assigned by the tax assessor are really only good the moment their done and remain static until the next assessment. The market however is constantly changing both up and down, which is why looking at a tax value doesn’t give a buyer any more information on the real market value of a property, all it tells them is how much they will pay in property taxes.

For more information about Assessed versus Market Value, you may wish to read a blog I posted here on Trulia about a year ago. I've attached the link below.
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