Round 1 — Property Tax Assessments vs. Market Value!
Hey there, Northern Virginia and DC homeowners! Brace yourselves because it’s that time of the year when property tax assessments hit our mailboxes, and we all let out a collective groan. But let’s face it, this annual debate about the assessed value versus market value is more confusing than understanding quantum physics while running on a treadmill. Let’s break it down, shall we?
Assessed Value is the value assigned to your property by the government for tax purposes and does not mean the same thing as market value. It may or may not be the same as the market value.
Market Value is what your property would sell for in the current market with active buyers and should coincide with the appraisal value. (Appraisals are performed by an independent third party on behalf of a mortgage lender to determine the property value for the purchaser’s loan. Appraisals may also be used to determine the property value for an estate or divorce.)
Why the difference between the two values, you ask?
The market value can change rapidly based on factors like the economy, consumer confidence, interest rates, home inventory, and buyer preferences.
Assessments are completed by a county assessor without looking at property conditions and do not fully reflect market dynamics. Your local tax rate determines the amount of tax you pay; this is set by each locality and may change from year to year.
Now, the big question: which one should you care about more? It depends on your situation. The market value matters most if you’re looking to sell your house. After all, that’s what buyers are willing to pay. However, if you want to challenge your property taxes, the assessed value is what you’ll need to focus on.
Though an increased property assessment in the DMV almost always means an increase in your taxes, isn’t a higher property value something we all strive to obtain? I once knew a real estate speculator who would offer to buy his neighbors’ homes at the tax-assessed value when they began complaining about their increased property taxes. He never had any takers but it’s important to keep the market value in mind when your taxes increase. You home is generally your largest investment; your financial portfolio has escalated along with property taxes.
Different localities have their own schedules for notifying homeowners of their assessment values, setting tax rates, and collecting tax payments. Let’s look at a few below:
Alexandria Assessments Mailed: Feb 15th, Installment Deadlines: June 15 + Nov 15, Appeals Deadline: March 15
Arlington County Assessments Mailed: January, Installment Deadlines: June 15 + Oct 5. Appeals Deadline: Mar 1
DC Assessments Mailed: February, August. Installment Deadlines: March 1 +September 15, Appeals Deadline: April 1
Fairfax County Assessments Mailed Late February, Installment Deadlines: July 28 + December 5, Appeals Deadline: April 1
Falls Church Assessments Mailed First quarter, Installment DeadlinesJune 6 + December 15, Appeals Deadline: Late April
Thinking about appealing your assessment or curious about the market value of your home?
Give us a holler anytime.
Yours in real estate and taxes,