Should I appeal property tax?

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skierincolorado
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Should I appeal property tax?

Post by skierincolorado »

Recently received 60% bump in assessesment. I'm confident that the house would not sell this high. Please assume I understand the requirements for successful appeal. It woule be appreciated if replies focused on the actual question.

However, I know that various home valuation tools online such as Zillow will use assessed value as one piece of information in forming their estimate. And I know some homeowners are biased by what Zillow says they house is worth when making an offer. If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value. Even if it would be financially neutral I would rather be contributing to the counties schools and government. Or am I just beeing foolish to think assessed value will have any affect on sale value?
Last edited by skierincolorado on Wed Jun 07, 2023 1:42 pm, edited 1 time in total.
DoubleComma
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Re: Should I appeal property tax?

Post by DoubleComma »

Personally I don't consider assessed value as a factor when making an offer on a home. We've bought and sold several homes and never has a Realtor mentioned assessed value when setting listing price or making an offer. Personally, I would look are area comps, which might be susceptible to others who may consider assessed value...I've just not seem that happen in real life.

In your situation if you believe the property tax assessment is too high, and there is a low friction appeal process, I would simply appeal it and see what happens.
exodusNH
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Re: Should I appeal property tax?

Post by exodusNH »

skierincolorado wrote: Tue Jun 06, 2023 2:44 pm Recently received 60% bump in assessesment. I'm confident that the house would not sell this high. However, I know that various home valuation tools online such as Zillow will use assessed value as one piece of information in forming their estimate. And I know some homeowners are biased by what Zillow says they house is worth when making an offer. If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value. Even if it would be financially neutral I would rather be contributing to the counties schools and government. Or am I just beeing foolish to think assessed value will have any affect on sale value?
In NH, official assessments happen every five years.

After reevaluation, the towns and cities reset their tax rate to roughly keep taxes the same. Depending on what happened with commerical vs residential, there might be a slight increase or decrease in what one pays, but it generally won't move by more than $100 for a typical house.

So, even if your house doubled in assessed value, your taxes won't really go up as long as most houses doubled in value.

The values from Zillow, et al., don't have an impact on the city's assessment.
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Jimbo Moneybags
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Re: Should I appeal property tax?

Post by Jimbo Moneybags »

exodusNH wrote: Tue Jun 06, 2023 2:54 pm So, even if your house doubled in assessed value, your taxes won't really go up as long as most houses doubled in value.
That is very state/county and locality dependent. Some elected officials see an increase in the property assessments as an "excuse" to increase the budget while slightly decreasing the property tax rate. So if total assessed value of properties in that jurisdiction increases 60%, the elected officials can increase the budget by 50%, drop the property tax rate by 10%, and truthfully proclaim that they cut the property tax rate.

If the jurisdiction provides for automatic reduction in property tax rates corresponding to any increase in values, what you opine would be true. Again, very specific to each state/county/locality.
toddthebod
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Re: Should I appeal property tax?

Post by toddthebod »

exodusNH wrote: Tue Jun 06, 2023 2:54 pm The values from Zillow, et al., don't have an impact on the city's assessment.
He's asking the opposite. Will having a lower assessed value reduce his Zillow/Redfin estimated value, and will having a lower Zillow/Redfin estimate reduce the price he can get for selling his house one day?
exodusNH
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Re: Should I appeal property tax?

Post by exodusNH »

Jimbo Moneybags wrote: Tue Jun 06, 2023 3:21 pm
exodusNH wrote: Tue Jun 06, 2023 2:54 pm So, even if your house doubled in assessed value, your taxes won't really go up as long as most houses doubled in value.
That is very state/county and locality dependent. Some elected officials see an increase in the property assessments as an "excuse" to increase the budget while slightly decreasing the property tax rate. So if total assessed value of properties in that jurisdiction increases 60%, the elected officials can increase the budget by 50%, drop the property tax rate by 10%, and truthfully proclaim that they cut the property tax rate.

If the jurisdiction provides for automatic reduction in property tax rates corresponding to any increase in values, what you opine would be true. Again, very specific to each state/county/locality.
I was referring specifically to NH. How I describe it is the process here. Everyone always freaks out when they hear the new assessments because it takes some time before the new tax rates are calculated.
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Jimbo Moneybags
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Re: Should I appeal property tax?

Post by Jimbo Moneybags »

exodusNH wrote: Tue Jun 06, 2023 3:40 pm
Jimbo Moneybags wrote: Tue Jun 06, 2023 3:21 pm
exodusNH wrote: Tue Jun 06, 2023 2:54 pm So, even if your house doubled in assessed value, your taxes won't really go up as long as most houses doubled in value.
That is very state/county and locality dependent. Some elected officials see an increase in the property assessments as an "excuse" to increase the budget while slightly decreasing the property tax rate. So if total assessed value of properties in that jurisdiction increases 60%, the elected officials can increase the budget by 50%, drop the property tax rate by 10%, and truthfully proclaim that they cut the property tax rate.

If the jurisdiction provides for automatic reduction in property tax rates corresponding to any increase in values, what you opine would be true. Again, very specific to each state/county/locality.
I was referring specifically to NH. How I describe it is the process here. Everyone always freaks out when they hear the new assessments because it takes some time before the new tax rates are calculated.
My error. I read the "your house" and "your taxes" to be directed to the OP where you actually intended it to be a summary of NH property taxes and assessments!
Jack FFR1846
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Re: Should I appeal property tax?

Post by Jack FFR1846 »

In Massachusetts, to find if your house is properly valued, you'd find similar houses in the town and compare their features and appraisal to yours. So if you have a garage and the comp doesn't, you add to your house the value of a garage. I appealed my value once. I used 10 comps to show that my house was unfairly more highly valued than it should be compared to the comps. If you don't see that your house is unfairly valued compared to the comps, you have no reason to complain. Mass also does as NH. If house values doubled with the new appraisal, for example, the tax rate would be cut in half.
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Brookie
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Re: Should I appeal property tax?

Post by Brookie »

Forget about your 50% bump. What is important is what the average taxpayer received as a "bump". If the average bump is 50%, yours is average and your tax increase is going to be like everyone else's. If the tax total in your municipality increases by 6%, your tax increase will be the same. If total taxes assessed and collected go down 2%, your taxes will follow. Be very concerned, however, if the average assessment has gone up (you pick the number!) 4, 8 or 16% while yours increased by 50%.
adamthesmythe
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Re: Should I appeal property tax?

Post by adamthesmythe »

You have to have a reason to appeal the assessment, not just that you think it's too high.

Do research about how assessed values are determined and find a reason that your new assessment is not in line with procedures or comparables. If you find something you may have grounds for an appeal.

And sensible buyers only look at the assessed value with respect to likely taxes. A buyer who tries to make assessed value a basis for his offer should be laughed at.
AlaskaTeach
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Re: Should I appeal property tax?

Post by AlaskaTeach »

Not anywhere near NH, a Texas story.

Our family budget was tight and I was working one, sometimes two part-time jobs. I decided to bring in some experts to give estimates to repair things the house needed to keep the appraisal down. It worked! Once I got the appraisal down lower than any other house in the neighborhood, the annual increase was limited to 10% and I didn't have to do too much to keep the taxes down. I finally took my foot off the brake and let the taxes rise the last couple of years before we sold the house.


I firmly believe it is worth your time to appeal the taxes.
lstone19
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Re: Should I appeal property tax?

Post by lstone19 »

Very much dependent on how property taxes work where you live, which you did not say.

For instance, in Illinois where I used to live, assessing property was independent of the tax levies passed by the government bodies. What you paid in property taxes was your share (assessed value of your property of the total assessed value of all properties) of the levies. If everyone's assessment doubled, everyone paid the same going forward. In other states, that's not (AFAIK) true and doubling all assessed value might double how much the taxing bodies collect.
miamivice
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Re: Should I appeal property tax?

Post by miamivice »

It costs nothing, other than a little time, to appeal property taxes.

I never have been successful but others in my county have. Your mileage will vary.
5280Tim
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Re: Should I appeal property tax?

Post by 5280Tim »

I just finished my appeal, also in Colorado. Our increase was almost 60%. The reason assessments went crazy this year is that our residents voted, for some unknown reason, to repeal a constitutional amendment that limited annual property tax increases. So the counties are taking advantage of the fact that they have no restrictions and can take advantage of the run up in housing prices over the last 7-8 years. It also doesn’t help that they performed the assessments last spring when rates were still low and houses were selling for over asking within a few days of being listed. 35%-45% increases across the board. It’s going to be really rough for a lot of people. I don’t know that would bother for a couple of hundred dollars, but we have a “special” assessment rate and my appeal could be worth thousands.
sport
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Re: Should I appeal property tax?

Post by sport »

Jack FFR1846 wrote: Tue Jun 06, 2023 3:51 pm In Massachusetts, to find if your house is properly valued, you'd find similar houses in the town and compare their features and appraisal to yours. So if you have a garage and the comp doesn't, you add to your house the value of a garage. I appealed my value once. I used 10 comps to show that my house was unfairly more highly valued than it should be compared to the comps. If you don't see that your house is unfairly valued compared to the comps, you have no reason to complain. ...
It works the same way in Ohio. Another measure you can use is the actual recent selling prices of houses similar to yours. I used both of these measures when I appealed a few years ago and got my taxes lowered $1450 per year. :D
invest4
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Re: Should I appeal property tax?

Post by invest4 »

DoubleComma wrote: Tue Jun 06, 2023 2:53 pm
In your situation if you believe the property tax assessment is too high, and there is a low friction appeal process, I would simply appeal it and see what happens.
This.

I have done the same and had it reduced once, while in another instance (different house), the assessor took me through the process step by step and at the end said “we are pretty good at this, don’t ya think?”.

Twas a strange feeling as I left, not having achieved my goal of the reduction, but feeling good that they spent the time with me and were indeed doing a good and fair assessment in my opinion.

Best wishes.
Maverick3320
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Re: Should I appeal property tax?

Post by Maverick3320 »

5280Tim wrote: Tue Jun 06, 2023 11:20 pm I just finished my appeal, also in Colorado. Our increase was almost 60%. The reason assessments went crazy this year is that our residents voted, for some unknown reason, to repeal a constitutional amendment that limited annual property tax increases. So the counties are taking advantage of the fact that they have no restrictions and can take advantage of the run up in housing prices over the last 7-8 years. It also doesn’t help that they performed the assessments last spring when rates were still low and houses were selling for over asking within a few days of being listed. 35%-45% increases across the board. It’s going to be really rough for a lot of people. I don’t know that would bother for a couple of hundred dollars, but we have a “special” assessment rate and my appeal could be worth thousands.
I'm guessing that those crazy residents were probably looking to fund some increased services that couldn't be funded by a property tax rate that was artificially low.
Retired2013
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Re: Should I appeal property tax?

Post by Retired2013 »

Jack FFR1846 wrote: Tue Jun 06, 2023 3:51 pm In Massachusetts, to find if your house is properly valued, you'd find similar houses in the town and compare their features and appraisal to yours. So if you have a garage and the comp doesn't, you add to your house the value of a garage. I appealed my value once. I used 10 comps to show that my house was unfairly more highly valued than it should be compared to the comps. If you don't see that your house is unfairly valued compared to the comps, you have no reason to complain. Mass also does as NH. If house values doubled with the new appraisal, for example, the tax rate would be cut in half.
+1
However, in our area, we must submit 3 comps and the comps must have sold within the past two years. You can download any of the data for the county for comparison.
Jack FFR1846
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Re: Should I appeal property tax?

Post by Jack FFR1846 »

AlaskaTeach wrote: Tue Jun 06, 2023 7:49 pm Not anywhere near NH, a Texas story.

Our family budget was tight and I was working one, sometimes two part-time jobs. I decided to bring in some experts to give estimates to repair things the house needed to keep the appraisal down. It worked! Once I got the appraisal down lower than any other house in the neighborhood, the annual increase was limited to 10% and I didn't have to do too much to keep the taxes down. I finally took my foot off the brake and let the taxes rise the last couple of years before we sold the house.


I firmly believe it is worth your time to appeal the taxes.
"Only" 10%? Holy Cow. Time to remove the "Taxachusetts" moniker and move it to "Taxas". Here in the Bay State, to go up more than 2 1/2%, the town has to designate specific things they want to spend the money on and then it's put up to a full vote. If not voted through, no increase. If voted through, only that specific thing can be funded. In our town, I've seen single things like a new Fire Engine on the ballot. I do often see people complaining about property taxes in Texas so looked up Austin. Holy Cow! The rate is more than double my rate.
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exodusNH
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Re: Should I appeal property tax?

Post by exodusNH »

Jack FFR1846 wrote: Wed Jun 07, 2023 6:43 am
AlaskaTeach wrote: Tue Jun 06, 2023 7:49 pm Not anywhere near NH, a Texas story.

Our family budget was tight and I was working one, sometimes two part-time jobs. I decided to bring in some experts to give estimates to repair things the house needed to keep the appraisal down. It worked! Once I got the appraisal down lower than any other house in the neighborhood, the annual increase was limited to 10% and I didn't have to do too much to keep the taxes down. I finally took my foot off the brake and let the taxes rise the last couple of years before we sold the house.


I firmly believe it is worth your time to appeal the taxes.
"Only" 10%? Holy Cow. Time to remove the "Taxachusetts" moniker and move it to "Taxas". Here in the Bay State, to go up more than 2 1/2%, the town has to designate specific things they want to spend the money on and then it's put up to a full vote. If not voted through, no increase. If voted through, only that specific thing can be funded. In our town, I've seen single things like a new Fire Engine on the ballot. I do often see people complaining about property taxes in Texas so looked up Austin. Holy Cow! The rate is more than double my rate.
Yeah, being from NH people ALWAYS complain about property taxes. The rate might be twice what it is in MA, but the assessments are lower, making the absolute dollars pretty close. But we don't have the income or sales taxes to contend with.

At the end of the day, the dollars it takes to run a government are going to basically be the same. Whether that money is from property taxes, income taxes, or sales taxes, you're probably going to be paying the same, adjusted for cost of living.

I like NH's way of handling property taxes, as it means that no one person is advantaged simply because they've lived there longer. CA's property tax regime seems insane to me!
MtnTraveler
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Re: Should I appeal property tax?

Post by MtnTraveler »

Also live in Colorado and have been hearing about the increase. I looked at mine and it went up but still way under market value or is there a percent of market value it's supposed to be? Seems like I got lucky since it's about 80k less than market.
NashTransplant
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Re: Should I appeal property tax?

Post by NashTransplant »

I appealed in Nashville and won. Was pretty easy using other comps. And my zillow value has kept right on climbing, and if I sold, I seriously doubt the assessed value would matter at all.
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Flobes
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Re: Should I appeal property tax?

Post by Flobes »

skierincolorado wrote: Tue Jun 06, 2023 2:44 pm Recently received 60% bump in assessesment...
MtnTraveler wrote: Wed Jun 07, 2023 11:30 am Also live in Colorado and have been hearing about the increase. I looked at mine and it went up but...
Also live in Colorado.

But I own a deed-restricted, appreciation-capped house. It increases in value 3% a year -- no more, no less.

Annual property tax notice was for substantially higher percentage increase.

I've filed an online appeal, very easy. Next, I have a phone meeting with assessor's office scheduled for tomorrow morning.
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Artful Dodger
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Re: Should I appeal property tax?

Post by Artful Dodger »

Back in the day our assessment went up to a figure I thought way over what the house was worth. A friend was very familiar with the appeal process, and he advised to pay for a professional appraisal. He said the assessment board would either use the appraisal or come pretty close. That's exactly what I did, and I emphasized to the appraiser that while I understood they were professionals, I clearly wanted them to come in as low as possible. I made their job a little easier, or at least I think I did, by providing comparable recent sales of less expensive properties. This was probably fifteen years ago, and I paid $350.

When I met with the assessor, I began my spiel like I expect most explaining that I thought the assessment was too high, yada, yada, yada. But, as soon as I said I had requested a professional appraisal, his eyes lit up and he said, "let me have it". They came back very close to my appraisal and lowered the taxes by $1500.

In my area, they don't use professional appraisers as assessors and will defer to a to a professional appraisal. That may or may not be the case in your area.
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skierincolorado
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Re: Should I appeal property tax?

Post by skierincolorado »

It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
Jags4186
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Re: Should I appeal property tax?

Post by Jags4186 »

By me there are companies that handle the appeal for you and take a percentage of the savings. Might be worth exploring.
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skierincolorado
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Re: Should I appeal property tax?

Post by skierincolorado »

DoubleComma wrote: Tue Jun 06, 2023 2:53 pm Personally I don't consider assessed value as a factor when making an offer on a home. We've bought and sold several homes and never has a Realtor mentioned assessed value when setting listing price or making an offer. Personally, I would look are area comps, which might be susceptible to others who may consider assessed value...I've just not seem that happen in real life.

In your situation if you believe the property tax assessment is too high, and there is a low friction appeal process, I would simply appeal it and see what happens.
Thank you for one of the only replies that answered the actual question. I agree people don't look at assessed value. But I know zillow is very widely used and people do look at the zillow valuation which is partially based on assessed value. Zillow even has a section for sellers on how to increase your zillow valuation, I assume because they believe it will affect sale price. I know I tried to focus on comps when we bought the house, but I did see the zestimate and was nervous that our offer was much higher than the zestimate.

It might not matter but the tax savings are also likely to be small. Is it worth a few hundred dollars in tax savings to risk a potentially much larger affect on sale price?
exodusNH
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Re: Should I appeal property tax?

Post by exodusNH »

skierincolorado wrote: Tue Jun 06, 2023 2:44 pm Recently received 60% bump in assessesment. I'm confident that the house would not sell this high. Please assume I understand the requirements for successful appeal. It woule be appreciated if replies focused on the actual question.

However, I know that various home valuation tools online such as Zillow will use assessed value as one piece of information in forming their estimate. And I know some homeowners are biased by what Zillow says they house is worth when making an offer. If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value. Even if it would be financially neutral I would rather be contributing to the counties schools and government. Or am I just beeing foolish to think assessed value will have any affect on sale value?
Unless your taxing authority is using Zillow's estimates for levying taxes, I am having trouble seeing how getting a separate, private assessment for tax purposes would affect the value listed in Zillow. It's not like your assessor is going to send the value into Zillow.

Sure, your city may agree with the lower value and update the database, but, even assuming Zillow consumes that data, that's simply one variable in their algorithm.
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skierincolorado
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Re: Should I appeal property tax?

Post by skierincolorado »

exodusNH wrote: Wed Jun 07, 2023 1:50 pm
skierincolorado wrote: Tue Jun 06, 2023 2:44 pm Recently received 60% bump in assessesment. I'm confident that the house would not sell this high. Please assume I understand the requirements for successful appeal. It woule be appreciated if replies focused on the actual question.

However, I know that various home valuation tools online such as Zillow will use assessed value as one piece of information in forming their estimate. And I know some homeowners are biased by what Zillow says they house is worth when making an offer. If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value. Even if it would be financially neutral I would rather be contributing to the counties schools and government. Or am I just beeing foolish to think assessed value will have any affect on sale value?
Unless your taxing authority is using Zillow's estimates for levying taxes, I am having trouble seeing how getting a separate, private assessment for tax purposes would affect the value listed in Zillow. It's not like your assessor is going to send the value into Zillow.

Sure, your city may agree with the lower value and update the database, but, even assuming Zillow consumes that data, that's simply one variable in their algorithm.
Assessed values are Public and used by zillow to help create their valuations
yohac
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Re: Should I appeal property tax?

Post by yohac »

skierincolorado wrote: Tue Jun 06, 2023 2:44 pm If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value.
If a successful appeal would only save a couple hundred bucks, I wouldn't bother. But it's your time.
EddyB
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Re: Should I appeal property tax?

Post by EddyB »

In another Rocky Mountains state, I challenged my appraisal in four consecutive biannual cycles, winning more than 50% reductions in the proposed increase in each occasion. Finally the appraiser revised their methodology to account for the argument that I had rightly raised over the prior decade, and the most recent increase seemed much more appropriate than earlier years. I think my “starting point” after 8 years of effort was much lower than it otherwise would have been.
exodusNH
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Re: Should I appeal property tax?

Post by exodusNH »

skierincolorado wrote: Wed Jun 07, 2023 2:09 pm
exodusNH wrote: Wed Jun 07, 2023 1:50 pm
skierincolorado wrote: Tue Jun 06, 2023 2:44 pm Recently received 60% bump in assessesment. I'm confident that the house would not sell this high. Please assume I understand the requirements for successful appeal. It woule be appreciated if replies focused on the actual question.

However, I know that various home valuation tools online such as Zillow will use assessed value as one piece of information in forming their estimate. And I know some homeowners are biased by what Zillow says they house is worth when making an offer. If we dropped the assessed value by 50k, it would save us $350/year in taxes. 25k would save $175/year in taxes. So the tax savings would be pretty small (low tax rates) and could easily be outweighed by any affect on resale value. Even if it would be financially neutral I would rather be contributing to the counties schools and government. Or am I just beeing foolish to think assessed value will have any affect on sale value?
Unless your taxing authority is using Zillow's estimates for levying taxes, I am having trouble seeing how getting a separate, private assessment for tax purposes would affect the value listed in Zillow. It's not like your assessor is going to send the value into Zillow.

Sure, your city may agree with the lower value and update the database, but, even assuming Zillow consumes that data, that's simply one variable in their algorithm.
Assessed values are Public and used by zillow to help create their valuations
Right, but it's one input out of probably dozens. And there will be a lag from the time you have the appraisal until it's public.

I can't answer how many people use Zillow as a basis for their bids. I think many people assume they're overvalued by some amount and rely on realtors to guide them.

As others have pointed out, if your house went up 60% and everyone else's went up 65%, there may not be much room to drop yours down.

My property valuation increased 41% in 2021 compared to 2020, but my taxes were 1.1% higher, because everyone's properties increased by about the same amount.
FeesR-BullNotBullish
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Re: Should I appeal property tax?

Post by FeesR-BullNotBullish »

At the very least, you can do a minimal effort appeal. Just cite some recently sold homes near you or quote the Zestimate. I did this once and was successful. I don't see how the appeal will negatively affect resale. I applaud you for wanting to contribute to schools. However, you can also do this as charitable contributions.
ondarvr
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Re: Should I appeal property tax?

Post by ondarvr »

skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
There is no connection between the two, they can be many tens of thousands apart.

People will sometimes look at the assessed value and past taxes paid, which is also on zillow, to see what the actual cost is. But many never even look or know the information is there and valuable.
000
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Re: Should I appeal property tax?

Post by 000 »

skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
When are you planning to sell?
Topic Author
skierincolorado
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Re: Should I appeal property tax?

Post by skierincolorado »

ondarvr wrote: Wed Jun 07, 2023 6:20 pm
skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
There is no connection between the two, they can be many tens of thousands apart.

People will sometimes look at the assessed value and past taxes paid, which is also on zillow, to see what the actual cost is. But many never even look or know the information is there and valuable.
There is a connection. Zillow says they use assessed value to form their valuation. There are many other factors including market trends since the valuation was made. But if I have the lowest assessed value in my neighborhood then zillow may value my house less than other recent sales.
ondarvr
Posts: 416
Joined: Tue Dec 22, 2020 5:03 pm

Re: Should I appeal property tax?

Post by ondarvr »

skierincolorado wrote: Wed Jun 07, 2023 6:43 pm
ondarvr wrote: Wed Jun 07, 2023 6:20 pm
skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
There is no connection between the two, they can be many tens of thousands apart.

People will sometimes look at the assessed value and past taxes paid, which is also on zillow, to see what the actual cost is. But many never even look or know the information is there and valuable.
There is a connection. Zillow says they use assessed value to form their valuation. There are many other factors including market trends since the valuation was made. But if I have the lowest assessed value in my neighborhood then zillow may value my house less than other recent sales.
It may be one of the factors, but not what makes the big moves, the assessed value can lag many years behind the actual market value. They are just looking to see if the assessed value is somewhat inline with the comps. I've owned properties that zillow doesn't have a calculation for, so their estimate might be $100,000 or more off from an appraised value for a loan or sale. And unless you report any updates, additions or changes to zillow, it's not reflected in the price shown.

My father was on the board of equalization, lots of people appealed, few were successful. Mostly because the real value did go up, the owner just didn't like the new valuation.
Last edited by ondarvr on Thu Jun 08, 2023 4:13 pm, edited 1 time in total.
cowbman
Posts: 638
Joined: Sat Jan 14, 2017 1:10 pm

Re: Should I appeal property tax?

Post by cowbman »

I didn't see the jurisdiction, which matters a lot...

In Texas, it seems as if about 1/4-1/3 appeal their taxes every 1-2 years. There are companies set up to do that for you. Of course, Zillow is also much less accurate in Texas as sales prices on homes are not disclosed.
Topic Author
skierincolorado
Posts: 2377
Joined: Sat Mar 21, 2020 10:56 am

Re: Should I appeal property tax?

Post by skierincolorado »

ondarvr wrote: Wed Jun 07, 2023 7:09 pm
skierincolorado wrote: Wed Jun 07, 2023 6:43 pm
ondarvr wrote: Wed Jun 07, 2023 6:20 pm
skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
There is no connection between the two, they can be many tens of thousands apart.

People will sometimes look at the assessed value and past taxes paid, which is also on zillow, to see what the actual cost is. But many never even look or know the information is there and valuable.
There is a connection. Zillow says they use assessed value to form their valuation. There are many other factors including market trends since the valuation was made. But if I have the lowest assessed value in my neighborhood then zillow may value my house less than other recent sales.
It may be one of the factors, but not what makes the big moves, the assessed value can lag many years behind the actual market value. They are just looking to see if the assessed value is somewhat inline with the comps. I've owned properties that zillow doesn't have a calculation for, so their estimate might be $100,000 or more off from an appraised value for a loan or sale. And unless you report any updates, additions or changes to zillow, it's not reflected in the price shown.

My father was on the board of equalization, lots of people appealed, few were successful. Mostly because the real value did go up, the owner just didn't like the new evaluation.
The fact that the zestimate and is 100k or more off from assessed doesn't prove anything though. Zillow likely just uses it to know the relative value of similar houses in a neighborhood but then market trends could change it dramatically. Buy you'd still expect the lower assessed properties to be worth less than the other properties even if the market went up 50%. It's not like 80s kitchens are coming back into style.

If I argue that my home is one of the least valuable in the neighborhood, even if everything goes up 50% in 2 years it will still be public record that my house is the cheap outdated lower value house relative to orhers.
lowkeytaco
Posts: 37
Joined: Sun Dec 15, 2019 10:11 am

Re: Should I appeal property tax?

Post by lowkeytaco »

skierincolorado wrote: Wed Jun 07, 2023 1:45 pm
DoubleComma wrote: Tue Jun 06, 2023 2:53 pm Personally I don't consider assessed value as a factor when making an offer on a home. We've bought and sold several homes and never has a Realtor mentioned assessed value when setting listing price or making an offer. Personally, I would look are area comps, which might be susceptible to others who may consider assessed value...I've just not seem that happen in real life.

In your situation if you believe the property tax assessment is too high, and there is a low friction appeal process, I would simply appeal it and see what happens.
Thank you for one of the only replies that answered the actual question. I agree people don't look at assessed value. But I know zillow is very widely used and people do look at the zillow valuation which is partially based on assessed value. Zillow even has a section for sellers on how to increase your zillow valuation, I assume because they believe it will affect sale price. I know I tried to focus on comps when we bought the house, but I did see the zestimate and was nervous that our offer was much higher than the zestimate.

It might not matter but the tax savings are also likely to be small. Is it worth a few hundred dollars in tax savings to risk a potentially much larger affect on sale price?
Hard to say. I think we don't know the key factors -- how much the assessed value of your property is taken into account when Zillow generates a value for your property and the extent to which buyers rely upon Zillow for what to offer. I bet the benefit to you of a tax decrease, which is immediate and fully realized by you, is likely to be more than the very small influence of assessed value on a Zestimate at some point in the future.
crefwatch
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Re: Should I appeal property tax?

Post by crefwatch »

When my NJ town did its last reassessment, you could schedule a meeting with the reassessment contractor for an overview of your re-assessment. When I did that, they had three (or was it five?) "comparables" ready to show me. That showed me that it was futile to appeal the new valuation.

Decades ago, before the internet, I successfully appealed in another NJ town. But I spent hours at the county office building looking at "pink" tax slips to find recent sales, looking up the buildings to see BR-count, Bath, Sq. Ft., driving by the houses, taking photos (real film) for the appeal, and so on. It was a lot of work.
NashTransplant
Posts: 86
Joined: Mon May 22, 2023 3:28 pm

Re: Should I appeal property tax?

Post by NashTransplant »

My assessed value post appeal was 1.05M.

My Zillow value is just under 1.5M

So if Zillow is using the assessed value, it is being dwarfed by the comps in the area. I will say, I feel like the comps suggest the house should be more like 1.6 based on $$ per SF, so maybe assessed value is a slight drag. But not enough to affect where I would price it.
statman
Posts: 206
Joined: Mon Jul 20, 2009 6:07 pm

Re: Should I appeal property tax?

Post by statman »

I successfully appealed an assessment - easy argument because the house next door was built the same year, similar design by the same architect, and had a lower assessment. So: do you have a good argument?
ondarvr
Posts: 416
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Re: Should I appeal property tax?

Post by ondarvr »

skierincolorado wrote: Wed Jun 07, 2023 11:07 pm
ondarvr wrote: Wed Jun 07, 2023 7:09 pm
skierincolorado wrote: Wed Jun 07, 2023 6:43 pm
ondarvr wrote: Wed Jun 07, 2023 6:20 pm
skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
There is no connection between the two, they can be many tens of thousands apart.

People will sometimes look at the assessed value and past taxes paid, which is also on zillow, to see what the actual cost is. But many never even look or know the information is there and valuable.
There is a connection. Zillow says they use assessed value to form their valuation. There are many other factors including market trends since the valuation was made. But if I have the lowest assessed value in my neighborhood then zillow may value my house less than other recent sales.
It may be one of the factors, but not what makes the big moves, the assessed value can lag many years behind the actual market value. They are just looking to see if the assessed value is somewhat inline with the comps. I've owned properties that zillow doesn't have a calculation for, so their estimate might be $100,000 or more off from an appraised value for a loan or sale. And unless you report any updates, additions or changes to zillow, it's not reflected in the price shown.

My father was on the board of equalization, lots of people appealed, few were successful. Mostly because the real value did go up, the owner just didn't like the new evaluation.
The fact that the zestimate and is 100k or more off from assessed doesn't prove anything though. Zillow likely just uses it to know the relative value of similar houses in a neighborhood but then market trends could change it dramatically. Buy you'd still expect the lower assessed properties to be worth less than the other properties even if the market went up 50%. It's not like 80s kitchens are coming back into style.

If I argue that my home is one of the least valuable in the neighborhood, even if everything goes up 50% in 2 years it will still be public record that my house is the cheap outdated lower value house relative to orhers.
With that line of thought, get the highest assessment you can get so it shows the value you want it to.

Between the actual market, the agent and what it shows like when the potential buyer gets there, the assessed value means nothing.
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JazzTime
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Re: Should I appeal property tax?

Post by JazzTime »

skierincolorado wrote: Wed Jun 07, 2023 1:41 pm It would be appreciated if replies focused on the actual question. I understand the process and requirements for a successful appeal as that information is widely available.

What I am less sure about is if the assessed value could affect my upcoming sale given 1) assessed value is used by zillow and other similar tools 2) zillow valuation likely factors into the decision making of some buyers
Well when are you planning to sell? If in a year, why bother with appealing your assessment? If in 5 years, then go for the tax savings.

Like some others have said, I don't take any stock in Zillow or other online value guesstimations. Sales price is based on comps in your area. Things like square footage comparisons, number of bathrooms, upgraded kitchen, landscaping, neighborhood desirability, etc. all figure into it. Moreover, sales value is based on what a willing buyer will pay at the time of sale. The buyer may fall in love with the place or may feel pressured because houses sell in one day. Or perhaps the market has slowed down and you only have one interested buyer who is so-so about it. Zillow value will be irrelevant.
The difficulty with jazz is there are too many notes. (Borrowed from Emperor's critique in Amadeus)
DoubleComma
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Re: Should I appeal property tax?

Post by DoubleComma »

skierincolorado wrote: Wed Jun 07, 2023 1:45 pm
DoubleComma wrote: Tue Jun 06, 2023 2:53 pm Personally I don't consider assessed value as a factor when making an offer on a home. We've bought and sold several homes and never has a Realtor mentioned assessed value when setting listing price or making an offer. Personally, I would look are area comps, which might be susceptible to others who may consider assessed value...I've just not seem that happen in real life.

In your situation if you believe the property tax assessment is too high, and there is a low friction appeal process, I would simply appeal it and see what happens.
Thank you for one of the only replies that answered the actual question. I agree people don't look at assessed value. But I know zillow is very widely used and people do look at the zillow valuation which is partially based on assessed value. Zillow even has a section for sellers on how to increase your zillow valuation, I assume because they believe it will affect sale price. I know I tried to focus on comps when we bought the house, but I did see the zestimate and was nervous that our offer was much higher than the zestimate.

It might not matter but the tax savings are also likely to be small. Is it worth a few hundred dollars in tax savings to risk a potentially much larger affect on sale price?
In places like CA where property tax assessments are regulated by Prop 13, the assessed value of the home quickly becomes uncorrelated to market value. For example, our first home in SF Bay Area was a 1976 ranch home in a track neighborhood that originally sold for $70k-$80k. We purchased that home for $500k which set our Prop 13 assessment baseline. 3 years later sold it for $710k, which set that buyers Prop 13 assessment baseline. The house directly next door is exactly the same in every way (floorplan, lot size, condition, etc) but it is still owned and lived in by the original owner from 1976. Today when I look at Zillow, my former home has a Zestimate of $1.46m and 2022 assessed value of $921k. The next door neighbor has a Zestimate of $1.41 and 2022 assessed value of $365k. So I'm not real sure how much assessed value factors into Zillow's algorithm. Maybe its different outside of California. I imagine you could check similar comparisons in your own neighborhood, assuming the homes are similar and not a custom home community.
Hebell
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Re: Should I appeal property tax?

Post by Hebell »

I had your problem. Back in 2015, we had a farmhouse with a mother-in-law suite with a separate certificate of occupancy, plus a large workshop zone for commercial use on the same plat/deed. We renovated the large workshop and added roll up doors for a loading zone. We really spruced up the yard . Nice landscaping native plants etc

The property assessor increased its value from $243,000 to $320,000 to be ramped up incrementally over 3 years. I damn near died when I got that letter and I appealed it. Part of the problem was that they interpreted the roll up doors to have created a garage on the workshop, something that the dimensions would not physically allow. No car could have been rolled into that area (I was using it as a pickup location for UPS and FedEx). By putting siding on the workshop it became a more habitable structure, and so forth and so on.

I argued there was no way on earth, in this small town, that this house was going to be able to get anywhere near close to $320,000. (The only reason I owned this property is zoning laws were flexible in this county, and I actually had a manufacturing exemption on the workshop for a commercial business which helped the small business at this address). I appealed, and disputed all their facts, and responded to their spreadsheet and so forth and so on, and they gave me $3,000 in relief.

I was so pissed off I sold the place. And I sold it for $240000 which was $3,000 less than what I paid for it in 2008. This was a depressed small town. I had to wait for another buyer like myself, who wanted to rent out the suite and use the workshop for their own business.

I understood how they got this high assessment, because their spreadsheet put a markup on all the improvements I made. But their spreadsheet was totally divorced from reality. Neighborhood comps did not seem to factor into their assessment values. When I consider my total cost basis, this was a really horrible real estate investment. Had this property been sitting in a more flourishing county, the story may have been quite different.
buddysam1
Posts: 11
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Re: Should I appeal property tax?

Post by buddysam1 »

I've bought and sold a number of homes over the years. Not once have I considered what Zillow says. I don't have any faith that their values are accurate. And I've never considered county property values. The only thing that matters is recent sales comps in your area.
I've also applied for and received a property tax reduction more than once. Easy process. Not much to lose but a couple hours of time looking at the county website and reviewing comps in your area. Then write the letter using those comps.
hiduplex
Posts: 99
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Location: IA

Re: Should I appeal property tax?

Post by hiduplex »

I'm really happy that I appealed my property taxes. The county wanted to raise them over $40,000. I did an in-person appeal filled out all the paperwork for the request and after that when I had my in-person meeting, they lower my assessed value to only a $14,000 increase and value instead of 40k. I definitely think it's worth the time the county way over assess the value. I'm in Iowa and Iowa's rolling out a property tax cap going forward.
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