How much credence do you put into the county tax value of a property? How do governments determine the tax value of a property? Are they very accurate? It seems that in my area the majority of the tax values are always below what the market value is. Is it safe to assume that the tax values are 10-20% below market?
Assessed values of properties, the valuations assigned by the local tax assessor for tax collection purposes, are almost meaningless and have no little to no relation to actual values. There’s a long list of reasons why this is so. Learn how to do your own comps or find an appraiser if you can’t.
one way to find out the values yourself is to drive the surrounding neighborhood. get phone numbers of homes for sale.
get price, rooms, age, lot size, br, ba, basement, garage, a/c, heating, sq footage (if ya can), and a few other basic things.
make a list.
check it twice…
then compare it all. it’s time consuming and it should be done in an area you plan to invest in, not after you’ve found a property. by the time you get done doing it, depending on the market, the property you were interested in will be long gone!
check out zillow.com for quick reference.
There are different kinds of comps. The one above is called a listing comp. Agents frequently try to give this to you. It can be deceit or ignorance on their part but if you remember they only use comps when they list a house to get the listing price. They let you and your emotions decide what you will buy the house for and they rarely use the sales comps thus they naturally go to the listing comp first. The listing comp is a comparison of what house like yours are listed for. It helps the agent decide what to list your property for. Sales comps are what the houses just like yours actually sold for (usually a lower number). This tells you what you property is really worth. I really don’t care what people are asking for their houses, I care what they are selling for. When an agent gives you comps, ask them to make sure that they pulled sales comps not listing comps.