I went on the city government site and looked up a property with a market value at 91k, And the assessed improvement value (taxable) is at 81,800. This property has fire damage but the structure is sound. Is the assessed improvement value based on a true # because the city inspected the property after the fire? Or is it an estimate based on the surrounding area. I'm in the Philadelphia market. Thanking you in advance!
My guess, neither the city government site OR the assessed improvement value site have made any knowledge of the property being fire damaged recently. My other guess is that their stated values are also just guesses (based on surrounding area guesses based on VAGUELY similar comp/s from 2 years ago - so that it becomes supposedly statistically significant). Good luck making sense of any of that. Cheers...
@Kenneth Bradford I had the same question as well. Basically what I understand is that the assessed value (for tax purposes) is 100% unrelated to the actual FMV of the property. Maybe someone else can chime in on the why and how of it, but I wouldn't worry about that number at all for any reason other than to determine what you'll be paying in taxes.
The assessed value accounts for the land, the exterior condition of the building, and the floor plan. It doesn't account for the specific features and materials contained inside the home. Neither does it account for the future potential value of the home, the community, interest rate environment and so on; all of which are factored into the fair market value (comparable sales). That's why you can always bet the FMV will come in significantly higher than the assessed value.
Get the Ultimate Beginner's Guide
Sign up today to receive the popular eBook for free!