You bought your house ten years ago and have recently been considering selling. New developments have come to your area, and you recently received a notice that the assessed value of your home has risen a considerable amount. You feel your excitement grow as you begin to think of how much more you’ll get for your home than you originally thought. This, you think, will allow you to pay off the remaining balance you owe on your home and still have lots to purchase your new home. But wait, let’s back up a second to clarify the origin of an assessed value.
The assessed value of a home is originated by the county tax assessor or municipality. This value is oftentimes arrived at by reviewing data from prior years and/or viewing the outside of homes and represents a general value in order to determine a tax rate for the property. In case you’re wondering…property taxes are used to pay for things like public schools, roads, and libraries. While the assessed value is important when it comes to paying property taxes, it really has little to do with the appraised value of a home. As a matter of fact, these two values are often times very different numbers.
An appraised value represents the value of a particular piece of property according to an appraiser after doing research and measurements on the interior and exterior of the home and comparing it to other similar, recently sold homes in the area. Real estate agents also use this same technique minus the measurements, when determining the value of a particular home. This value provided by the appraiser is used by lenders to determine how much they are willing to loan a purchaser for that particular home. An appraised value also helps buyers determine how much they would like to pay for a particular home considering its specific attributes.
The assessed value represents a general value and an appraised value represents a specific value. Also note that appraised values can vary because an appraiser is simply giving his/her opinion on the value of the property. This is a well researched opinion, but an opinion nonetheless. So, if you’re thinking of selling your home and want an accurate value of what your home is now worth, the best method is to either contact a local realtor, many provide the information at no cost, or hire an appraiser for roughly $300-$400.
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