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General Assessment Questions General Assessment Questions What is a property revaluation project? Property
revaluation is a systematic review of all real estate within the county
for the purpose of setting fair market values as of a specific point in
time. During a revaluation, every property is examined and adjustments
are made to county records to be sure that all property is assessed at
market value. Revaluation in Pennsylvania is done only on a county-wide
basis. Why
does property have to be assessed? Under
Pennsylvania law, property taxes are the primary source of revenue for
county and municipal governments and school districts. Property taxes,
which are calculated using the assessed values and millage rates set by
local government authorities, fund critical services including public
safety (fire, police, and ambulance), education, corrections, the court
system, public health programs, and human service programs. An
assessment is a fractional portion of the fair market value of your property.
In Pennsylvania, the County may choose an assessment ratio from 1% up
to 100% of market value. Fayette County recently changed its ratio from
35% to 100% for the 2001 fiscal year. This was intended to make it simpler
for the property owner to understand. A property owner can now look at
his or her statement and see exactly the value placed on the property
by the County.
According
to the U.S. Office of the Comptroller of the Currency, market value is defined
as "the most probable price which a property should bring in a competitive
and open market under all conditions requisite to a fair sale, the buyer
and seller, each acting prudently and knowledgeably, and assuming the price
is not affected by undue stimulus. Implicit in this definition is the consummation
of a sale as of a specified date and the passing of title from seller to
buyer under conditions whereby: 1. Buyer and seller are typically motivated;
2. Both parties are well informed or well advised, and acting in what they
consider their own best interests; 3. A reasonable time is allowed for exposure
in the open market; 4. Payment is made in terms of cash in U.S. dollars
or in terms of financial arrangements comparable thereto; and 5. The price
represents the normal consideration for the property sold unaffected by
special or creative financing or sales concessions granted by anyone associated
with the sale." Time
and inflation (or deflation) are the primary reasons for market value
to change, but there are other reasons as well. For example, if a major
industry leaves an area, property values can decline. On the other hand,
when transitional neighborhoods are discovered by young homeowners, values
may increase quickly as these areas become more popular. Even with no
extraordinary pressure in the marketplace, inflation alone may increase
property values. In the forty-plus years since Fayette’s last property
valuation, the market values have changed many times. How
will I know if my assessment is correct? You
should first try to decide for yourself what your property is worth. Look
at area sales, contact appraisers, and compare assessments of similar
homes. What
evidence do I need if I decide to make a formal appeal to the Board of
Assessments?
State
law puts the burden of proof on the property owner to show that the assessment
is incorrect. Your evidence must be strong enough to prove that the assessor’s
value is incorrect. Only relevant testimony given at the hearing will be
considered by the Board. Stating that property taxes are too high is not
relevant testimony.
You should establish in your own mind what you think your property is
worth. The best evidence for this would be recent sales prices for properties
similar to yours. The closer in proximity and similarity, the better the
evidence. Another type of evidence is oral testimony from a witness who
has made a recent appraisal of your property. If your home has a structural
problem or some other deficiency (such as mine subsidence damage) that
would affect its market value, collect documents such as repair estimates
or photographs and take the information with you. The
assessor’s duties are to discover, list, and place a value on all taxable
real property in the county in a uniform manner. The assessor is not involved
in collecting property taxes. The assessor does not create a value, but
rather interprets what is happening in the marketplace. Generally speaking, improvements that increase the market value of a property will increase the assessed value. The following are typical items that will increase the assessed value of your property:
Will my assessment go up if I repair my property? Good maintenance will help retain the market value of your property. Generally, your assessment will not be increased for individual minor repairs such as those that follow; however, a combination of several of these items could result in an increased assessment.
How can my assessment change when I haven't done anything to my property? General
economic conditions such as interest rates, inflation rates, supply and
demand, and changes in tax laws, will influence the value of real estate.
As property values change in the market place, those changes must be reflected
on the assessment roll. Do all assessments change at the same rate? There
are differences between individual properties and between neighborhoods.
In one area the sales may indicate a substantial increase in value in
a given year. In another neighborhood there may be no change in value,
or even a decrease in property values. Different types of properties within
the same neighborhood may also show different value changes. For example,
one-story houses may be more in demand than two-story houses, or vice
versa. Older homes in the same area may be rising in value more slowly
than newer homes. |
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