Property assessment is a process in which a piece of real estate is inspected to determine its value for the purpose of taxation. Assessment is carried out by a government official or an agency which has a contract with the government. When a property changes hands, the value is usually assumed to be the sales price, and a rate of taxation will be based on that. Property owners can also specifically request an assessment if they feel that their tax rate is unfair.
Property assessment is not quite the same thing as appraisal. While both are used to arrive at an estimate of value, appraisals are used differently. Insurance companies may order an appraisal before covering a house, to confirm that the policy is appropriate for the home. Likewise, people can also request an appraisal for the purpose of determining a reasonable price for a property. The appraiser attempts to determine fair market value, figuring out how much a house will sell for in the given market conditions, and may consider issues such as comparable properties for sale.
In a property assessment, an inspector verifies that the property is where it is supposed to be, measures the lot, and physically inspects the property. The assessor determines value on the basis of things like the property condition, amenities, size, location, and so forth. This value is used as the base rate for tax calculations, which makes it important to confirm that it is correct. In some regions, the assessor may also take note of problematic conditions which should be brought to the attention of code enforcement agencies.
The value of a property can fall unexpectedly. People paying high property taxes may request that a property assessment be conducted to adjust the value of the home for purposes of taxation. Likewise, government officials may order an assessment if they think that property values have risen significantly and an adjustment may be necessary. Adjustments are designed to keep the taxes paid on a property at a reasonable level.
People can see the current assessed value of a piece of real estate on tax statements. These statements are issued by the branch of local government which handles property taxes, and the statement should include a detailed breakdown of tax rates. For example, someone may pay a flat property tax for the region, along with a school tax, a fire district tax, and a special assessment tax for the city she or he lives in. This agency also handles property assessment tasks, and keeps records on assessment results, if people are interested in knowing how an assessor arrived at a specific number.
Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a SmartCapitalMind researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.