Curious Why Property Taxes Don't Match Home Values

Most people believe the value of their home has dropped significantly in the past year, and wonder why their property taxes are still so high.

Tony from Taunton Declared his Curiosity: "Why haven't property assessment values decreased as home values have decreased? By law, the assessed value should be equal to the fair market value."

Tony is correct. The assessed value should be equal to the fair market value, but not the fair market value right now.

TWO YEAR LAG

"Don't compare your house to a sale next door that happened two weeks ago," said Bob Ellia, the Executive Director of the Massachusetts Association of Assessing Officers. When assessors put a value on your house each December, it is based on home sale figures from two years ago. That means if the real estate market was high back then, your assessment and therefore your property taxes will be high today.

Tony Trodella, the chief assessor in Marlboro, says it is very confusing to home owners. "When people get their bills, they're going to say 'my house wouldn't sell for that today' and they're probably right."

WRONG HOME DATA

The assessed value can still be incorrect even if it's based on sales data from two years ago. In that case you can fight for a reduction, known as abatement. Believe it or not, sometimes it can be easy.

"Abatements can be made by simply making sure that the information that we have on the house is accurate," said Trodella. "If there's a physical discrepancy, we can fix that immediately." For example, if the assessor's office has your home listed with three bathrooms, but you only have two, it's a quick fix.

DO YOUR HOMEWORK

Homeowners can look up the data on record at the assessor's office, or in many towns the information is available online. If that data is correct you can still appeal, but it will take some more legwork on your part.

The goal is to find properties similar to yours that sold two years ago, for less than what yours is valued at today. How many do you need to find? "Naturally the more the better," said Ellia, "five or more is probably a good number for discussion."

Try to find properties as close geographically to your home as possible. "The bigger the circle you make, the less accurate the numbers are," Ellia said. The assessor or a real estate agent can help you find the sales figures from two years ago.

When it's time to appeal, go see the assessor, but don't go looking for a fight. You will have better luck with a smile on your face, and solid research in your hand. Remember, you will get your next assessment in December and you only have until February 1, 2010 to file that appeal.

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