When you purchase a home you will file a Warranty Deed transferring ownership. As part of the filing you will be required to report the value/purchase price. This value/purchase price determines the charge for State tax/stamps which is paid when the deed is filed. It is my understanding that this value/purchase price is also used to determine the new assessed value for tax purposes. Many municipalities will also do a periodic reassessment of property values as dictated by local regulations which could be once a year or once every 2-8 years.
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