<p>I can’t be the only one with this question/situation…</p>
<p>When we bought our house a little over 2 years ago, our property taxes were based on the house being valued at about 20k more than we paid for it :mad: . We challenged that with our county’s auditor (or whoever it was) and did get it reduced by a few thousand. If I’m remembering correctly, it was still higher than what we paid though.
So now our house is probably worth at least 10k less than what we paid for it. Meaning, we’d be lucky to sell it for that price. Yet I think our property taxes are based on a price around 25k more than what we paid.
Is there a trick to challenging this? We’d just like to have it at least reduced to a true fair market value.</p>
<p>This all depends on the laws in your state/county. </p>
<p>Here in PA - a home is assessed at the time of occupancy. This may or may not be fair market value. There will be a mulitplier if a reassessment has not been done for many years. Right now our county determines the fair market value (for a new home may or may not be the purchase price) and multiplies that by 80%.
Here also, homes are not allowed to be reassessed when they are sold.</p>
<p>What you should do is look at your neighbors homes. Homes in your community that are very similar to yours - same # bedrooms, bathrooms, similar lot size. See what their assessment is. If yours is significantly higher then you may have a case.</p>
<p>The law in PA allows property owners to file an appeal for a reassessment only once a year - in August. So, there may be a window of opportunity for you. You probably won’t win based on your home value declining since everyone else’s market value has declined as well.</p>
<p>I suggest you place a call to your county’s assessment office for an explanation of the laws, or look on your county’s website.</p>
<p>In King County, all houses are reassessed every year [King</a> County Department of Assessments](<a href=“http://www.metrokc.gov/Assessor/]King”>http://www.metrokc.gov/Assessor/) . You should have received your property tax valuation notice. After that, the individual cities and towns set their budgets and apportion your share of that budget based on your property tax value. Thus, if everyone in your neighborhood is assessed high, you’ll all pay your fair share. Relative value matters more than absolute value. In an ideal world, everyone else in your neighborhood is valued high and you’re valued low. Of course, that may be a problem if you go to sell, because the buyer may wonder what’s wrong with your house.</p>
<p>[Real</a> Estate Valuations, Homes for Sale, Free Real Estate Information | Zillow Real Estate](<a href=“http://www.zillow.com%5DReal”>http://www.zillow.com) provides an easy way to check what your neighbors’ houses are assessed for.</p>
<p>Property taxes are an interesting thing to look at.</p>
<p>I see Washington state follows the practice of assessing property at 100% of value. Some other states use a lower % of value, which has cosmetic advantages, and avoids situations like yours where the assessment can clearly be challenged since you were able to buy the house for less.</p>
<p>The best way to challenge is to look at the most recent sales (say over the past three or four years), and compare that to the most recent assessment. If those comparable show that you are over-assessed, then you’ll have a case. You’ll have to do it using other houses in your neighborhood, for the reason noted below. </p>
<p>BTW, I believe that most communities which have some non-homogeneity in housing stock follow the practice of over assessing the upper income areas, including any new construction. There is an embedded mindset at town hall that property taxes ought to be more “progressive” for newcomers and those who earn more than the average town citizen. If you’re in one of those areas, you’ll see it show up in the sales price/assessment data. The nicer houses sell at lower premiums, or even discounts to their assessments, while the more modest houses sell for higher fractions of their assessments. This is because the assessments are “tweaked” by the town politicians for political purposes. </p>
<p>Back to the states who use ,for instance, a 70% of market value assessment. Note that it makes no difference in your tax since you get the same fraction of total tax as your bill. But it makes people feel like they are getting some kind of “break” since they know their house is worth more than the assessment. The absolute value of any assessment is meaningless. The only thing that has meaning is the relationships among the properties.</p>
<p>Our town hasn’t reassessed since the 1950s! Assessments are all over the map and regularly challenged. They do have something called an equalization rate that seems to indicate our house is valued for about half of what it is worth. I think our taxes are pretty reasonable despite the fact that the banner headline today was that our county has the highest taxes in the entire nation. :eek:</p>
<p>The process here is to find similar houses in your neighborhood that have lower taxes than yours. People win all the time.</p>
<p>Yes, it depends on laws in your state/county/town. One quirk of our town’s regs is that while a homeowner can contest the valuation, there is only a very brief window for doing so. I don’t recall whether it’s four weeks after revaluation or a little more. Since revaluations are done only every five years …</p>
<p>DrDrew; In WA reassessments are done by county, so in our county, where it is done every four years, only 25% of the county is having a heart attack at a time. Each county does it differently, so you’d better check the rules in your county, but I would find “comps” based on 2008 closings for the 2009 taxes or based on 2007 for 2008 taxes and we here have to protest within 30 days of being reassessed, so get your rules out!</p>
<p>In NYS, assessments are generally a mess. Not having a reassessment done since the 50’s is nearly criminal. The State does apply an equalization rate to each town, which it does through a statistical model based on some sampling of assessments, in order to determine what % of market value the assessments really are. Your town probably has a ridiculously low equalization rate. The problem is that inequities can grow over time and the State’s attempt to equalize values is very, very rough. I assumes that everyone’s assessment is off by the same amount.</p>
<p>You have a situation where assessing is done by grievance. New York State has many hidebound laws. This is one of them.</p>
<p>thanks for the replies!
I don’t know when we got our assessment, but it was probably longer than 30 days ago. I’ll make sure to pay attention better next year. We get a new one every year.</p>
<p>Dadof B&G, believe me the question of assessments comes up regularly. The argument is that it should be done on a countywide basis, but that hasn’t happened. At least one town just took the bull by the horns and did it a few years back. Of course there were winners and losers. The trouble with assessing by grievance is that budgets are set by what is supposed to come in and then it doesn’t when people are successful in getting their taxes lowered. It’s a mess.</p>
<p>And of course, I’m not lobbying to get the assessment done, because I’m pretty sure my taxes would go up. :)</p>
<p>I don’t blame anyone for not wanting to pay more taxes; I was grousing about the system in NYS. Assessing definitely should be done on a countywide basis, but that means the various towns have to agree to it. Ha! Likely. Everyone wants government efficiency until it actually affects them. Well this is a democracy, so I guess we get what we (collectively) ask for.</p>
<p>I live upstate and we have slowly been reassessing, town by town. Very painful, but more equitable in the long run.</p>
<p>One of the biggest problems in many states (even those that reassess ever so many years) with the grievance procedures is that your taxes may go up or down. I know a lot of folks who would like to file grievances but who do not because of the chance that their taxes may be raised.</p>
<p>Some localities base their property tax on the number of square feet in the house, rather than the value. </p>
<p>In colonial times, houses in Charleston SC were taxed based on their frontage to the road. So most antique houses in Charleston face sideways to the road. </p>
<p>But I guess that bit of historical info doesn’t help the OP…</p>