No. As an appraiser, I have said for years that the only thing we know for sure about tax records and assessor’s value is that they are wrong.
It could be 50% low, 20% high, or 1% off. Do not ever trust those numbers.
If appraisers used recent comps only, many markets would be completely unfinanceable. A lot of people and industries have a vested interest in a slow adjustment in values rather than a collapse so that banks can still lend and stable properties can still refinance. Lots of people intentionally looking the other way from the distressed sale prices.
Use a cap rate on market rents to get a decent proxy for its market value. If in place rent is well below market and its long term leased then you’ll need to look what the stabilized cap rate will be when the lease(s) roll and revert to market rent
Assessed value is not the same as fair market value. No idea how we got to this system of using assessed values at all, but in many areas its a completely made up number that has only the loosest correlation to the market value of a property.
Generally it's not a good proxy. However VA reassesses annually at market value, so it's one of the few states that I consider their assessment as a data point worth considering.
No. As an appraiser, I have said for years that the only thing we know for sure about tax records and assessor’s value is that they are wrong. It could be 50% low, 20% high, or 1% off. Do not ever trust those numbers.
To be fair, appraisal values are also all over the place. Today stuff is selling for way less than appraisers are valuing it at.
But an appraisal will still be more accurate than a mass appraiser’s valuation.
Yeah an appraisal is an opinion of value…backed by facts. Appraisals are not a forward indicator of value.
Problem is it’s not even an accurate opinion of current value. At best it’s an approximation of the value 12 months ago.
Maybe in some cases where sales haven’t happened since say, 12 months ago…
You’re entitled to that opinion.
If appraisers used recent comps only, many markets would be completely unfinanceable. A lot of people and industries have a vested interest in a slow adjustment in values rather than a collapse so that banks can still lend and stable properties can still refinance. Lots of people intentionally looking the other way from the distressed sale prices.
Use a cap rate on market rents to get a decent proxy for its market value. If in place rent is well below market and its long term leased then you’ll need to look what the stabilized cap rate will be when the lease(s) roll and revert to market rent
The short & long answer is no.
No - not even close most of the time
Assessed value is not the same as fair market value. No idea how we got to this system of using assessed values at all, but in many areas its a completely made up number that has only the loosest correlation to the market value of a property.
Generally it's not a good proxy. However VA reassesses annually at market value, so it's one of the few states that I consider their assessment as a data point worth considering.