Newbie Property Tax Question

[FFlank]

I randomly looked at about twenty recently purchased homes on the Sumter County Tax Collector's website and in each instance, the assessed value (before any exemptions were applied) was way less than the sales price. When I look at the property tax estimator on the property appraiser's website, they just want you to enter the sales price. It seems that the property assessor sets an assessed value that is somewhere around 80 to 85% of the sales price for property tax purposes. I take this to be a good thing since it means we all pay a lesser amount, but I can't figure out WHY this is the case. Does anyone know of any statute or rule that causes this to happen? I know that I can use the estimator but it just seems that this will give me an artificially high number, and the appraiser will likely change it downward to some amount after the purchase. I'm not considering the homestead exemption or any of the other statutory exemptions. This seems to be an across the board phenomenon before any exemptions are applied. My thanks to anyone who has the answer to this.

[retiredguy123]

The county website shows a market value and an assessed value. The assessed value is about 75 percent of the market value, depending on the county, and their formula. Legally, the sales price has nothing to do with it. The county appraiser determines the market value.

[Rainger99]

I randomly looked at about twenty recently purchased homes on the Sumter County Tax Collector's website and in each instance, the assessed value (before any exemptions were applied) was way less than the sales price. When I look at the property tax estimator on the property appraiser's website, they just want you to enter the sales price. It seems that the property assessor sets an assessed value that is somewhere around 80 to 85% of the sales price for property tax purposes. I take this to be a good thing since it means we all pay a lesser amount, but I can't figure out WHY this is the case. Does anyone know of any statute or rule that causes this to happen? I know that I can use the estimator but it just seems that this will give me an artificially high number, and the appraiser will likely change it downward to some amount after the purchase. I'm not considering the homestead exemption or any of the other statutory exemptions. This seems to be an across the board phenomenon before any exemptions are applied. My thanks to anyone who has the answer to this.

Property taxes are calculated on the total taxable value of your home. The total taxable value of your home is calculated by subtracting any applicable exemptions from the assessed value of your home. The Property Appraiser's Office is responsible for determining the assessed value of all homes within Sumter County. For more information on how your home's assessed value is determined, please contact the Property Appraiser's Office at (352) 569-6800.

[cswett5234]

I am the dreaded tax assessor for a small town in Maine, and like FL, assessments are based on local sales. These sales are used to determine the price per square foot as the BASE for the calculations. There are factors that push/pull the values up/down, such as square footage, year built, physical depreciation (wear/tear of a building), amenities such as number of BR/Bathrooms, etc…, Quality of construction, all these items affect the overall value. So, it’s often hard to compare apples-to-apples as most homes are slightly different.

You and your neighbor may have identical homes, 1200 sf ranch, but maybe your upkeep is better than his, perhaps you have a newer roof, this affect depreciation; maybe he has 3 bathrooms and you only have 2, all these make a difference in calculating value.

In Maine, we look at the sales ratio (this is the ASSESSED value divided by the SALE price) and when we do this, we look at the center quartile of sales or the middle 50% of sales; this eliminates the outliers. This ratio helps determine the updated building values.

Hope this helps…Clint

[Bill14564]

I randomly looked at about twenty recently purchased homes on the Sumter County Tax Collector's website and in each instance, the assessed value (before any exemptions were applied) was way less than the sales price. When I look at the property tax estimator on the property appraiser's website, they just want you to enter the sales price. It seems that the property assessor sets an assessed value that is somewhere around 80 to 85% of the sales price for property tax purposes. I take this to be a good thing since it means we all pay a lesser amount, but I can't figure out WHY this is the case. Does anyone know of any statute or rule that causes this to happen? I know that I can use the estimator but it just seems that this will give me an artificially high number, and the appraiser will likely change it downward to some amount after the purchase. I'm not considering the homestead exemption or any of the other statutory exemptions. This seems to be an across the board phenomenon before any exemptions are applied. My thanks to anyone who has the answer to this.

It could be because you are looking at recently purchased homes. The market value might be based on the recent sale while the assessed value might be based on an assessment performed last year. If that is the case then the assessed value will catch up to the market value when the home is reassessed this year.

For my home, purchased several years ago, the assessed value and market value were the same last year but this year the assessed value is about 80% of market value. For my home, this is due to the Save Our Homes benefit which limits the increase in assessed value. This shows that assessed values follow market values and that market values increased significantly since last year.

Take a look at homes purchase a little over 13 months ago and see if the market values and assessed values aren't closer in those.

[FFlank]

I am the dreaded tax assessor for a small town in Maine, and like FL, assessments are based on local sales. These sales are used to determine the price per square foot as the BASE for the calculations. There are factors that push/pull the values up/down, such as square footage, year built, physical depreciation (wear/tear of a building), amenities such as number of BR/Bathrooms, etc…, Quality of construction, all these items affect the overall value. So, it’s often hard to compare apples-to-apples as most homes are slightly different.

You and your neighbor may have identical homes, 1200 sf ranch, but maybe your upkeep is better than his, perhaps you have a newer roof, this affect depreciation; maybe he has 3 bathrooms and you only have 2, all these make a difference in calculating value.

In Maine, we look at the sales ratio (this is the ASSESSED value divided by the SALE price) and when we do this, we look at the center quartile of sales or the middle 50% of sales; this eliminates the outliers. This ratio helps determine the updated building values.

Hope this helps…Clint

Thanks Clint! I know this stuff is much more involved than my post suggests, but the percentage (of the sales price) varied from 80% up to about 87% and they were all brand new homes in the same neighborhood. I appreciate your response.

[FFlank]

It could be because you are looking at recently purchased homes. The market value might be based on the recent sale while the assessed value might be based on an assessment performed last year. If that is the case then the assessed value will catch up to the market value when the home is reassessed this year.

For my home, purchased several years ago, the assessed value and market value were the same last year but this year the assessed value is about 80% of market value. For my home, this is due to the Save Our Homes benefit which limits the increase in assessed value. This shows that assessed values follow market values and that market values increased significantly since last year.

Take a look at homes purchase a little over 13 months ago and see if the market values and assessed values aren't closer in those.

Good idea. I'll try that.

[rjm1cc]

My guess is appliances are not considered part of the homes assessed value and these are deducted. But I don't know what else would get deducted to get you to say 85% of the sales price.

[BrianL99]

I randomly looked at about twenty recently purchased homes on the Sumter County Tax Collector's website and in each instance, the assessed value (before any exemptions were applied) was way less than the sales price. When I look at the property tax estimator on the property appraiser's website, they just want you to enter the sales price. It seems that the property assessor sets an assessed value that is somewhere around 80 to 85% of the sales price for property tax purposes. I take this to be a good thing since it means we all pay a lesser amount, but I can't figure out WHY this is the case. Does anyone know of any statute or rule that causes this to happen? I know that I can use the estimator but it just seems that this will give me an artificially high number, and the appraiser will likely change it downward to some amount after the purchase. I'm not considering the homestead exemption or any of the other statutory exemptions. This seems to be an across the board phenomenon before any exemptions are applied. My thanks to anyone who has the answer to this.

Every state is different. What the case is in Maine, may not be in New Hampshire or Florida.

In Florida, we pay property taxes in arrears and we pay per calendar year, not fiscal year.

In Florida, the date of Assessment is always January 1st. You are taxed on that valuation (1/1).The "Assessed Value" is not necessarily the purchase price.

In other words, if you bought a home in October, it doesn't matter what you paid, the Valuation was done the prior January 1.

Florida also has a number of statutory conditions that can adjust the Valuation.

Here's a reasonably simple chart of the process.

https://floridarevenue.com/property/Documents/PTSDetail.pdf

[spinner1001]

I randomly looked at about twenty recently purchased homes on the Sumter County Tax Collector's website and in each instance, the assessed value (before any exemptions were applied) was way less than the sales price. When I look at the property tax estimator on the property appraiser's website, they just want you to enter the sales price. It seems that the property assessor sets an assessed value that is somewhere around 80 to 85% of the sales price for property tax purposes. I take this to be a good thing since it means we all pay a lesser amount, but I can't figure out WHY this is the case. Does anyone know of any statute or rule that causes this to happen? I know that I can use the estimator but it just seems that this will give me an artificially high number, and the appraiser will likely change it downward to some amount after the purchase. I'm not considering the homestead exemption or any of the other statutory exemptions. This seems to be an across the board phenomenon before any exemptions are applied. My thanks to anyone who has the answer to this.

Government property appraisers have a different mission than ordinary real estate appraisers. Since it is the government, they are expected to strictly follow principles of fairness, equity, and so on. Overall, government property tax officials must also be practical because their work and outcomes are part of politics with reelections for property appraisers and avoidance of mass outrage of citizens complaining about their assessed property values for paying taxes. Put simply, few citizens complain if their tax assessed property values are less than what their neighbor’s house sold for.

The activity that government property appraisers do is called ‘mass appraisal’. For ordinary residential properties, mass appraisals almost certainly use computers, statistics, and sophisticated valuation models to annually assign assessed values to thousands of homes with relatively little human intervention. Ordinary real estate appraisers generally don’t do any of that and instead look at the sales prices of several homes in your neighborhood and make some adjustments for different characteristics such as swimming pools and renovations.

If you think this is in the weeds, you might look over the document at the link below that describes professional standards for mass appraisals that government property appraisal do. It is quite technical.

https://www.iaao.org/media/standards/StandardOnMassAppraisal.pdf

[retiredguy123]

Government property appraisers have a different mission than ordinary real estate appraisers. Since it is the government, they are expected to strictly follow principles of fairness, equity, and so on. Overall, government property tax officials must also be practical because their work and outcomes are part of politics with reelections for property appraisers and avoidance of mass outrage of citizens complaining about their assessed property values for paying taxes. Put simply, few citizens complain if their tax assessed property values are less than what their neighbor’s house sold for.

The activity that government property appraisers do is called ‘mass appraisal’. For ordinary residential properties, mass appraisals almost certainly use computers, statistics, and sophisticated valuation models to annually assign assessed values to thousands of homes with relatively little human intervention. Ordinary real estate appraisers generally don’t do any of that and instead look at the sales prices of several homes in your neighborhood and make some adjustments for different characteristics such as swimming pools and renovations.

If you think this is in the weeds, you might look over the document at the link below that describes professional standards for mass appraisals that government property appraisal do. It is quite technical.

https://www.iaao.org/media/standards/StandardOnMassAppraisal.pdf
When I lived in Georgia, the market values set by the county appraiser were often higher than the actual market values. One year, my house was appraised at $30K above what the house was actually worth. The appraiser gave me a few addresses that he used to set the value. However, those houses were waterfront properties. Apparently, he had deliberately selected high value properties to raise the appraisal. That was the only time I ever appealed my tax bill and I won the appeal.

[spinner1001]

When I lived in Georgia, the market values set by the county appraiser were often higher than the actual market values. One year, my house was appraised at $30K above what the house was actually worth. The appraiser gave me a few addresses that he used to set the value. However, those houses were waterfront properties. Apparently, he had deliberately selected high value properties to raise the appraisal. That was the only time I ever appealed my tax bill and I won the appeal.

There are exceptions. Appeal hearings can address exceptions, fortunately, in addition to the next election cycle to vote out a bad property tax appraiser.

[BrianL99]

When I lived in Georgia, the market values set by the county appraiser were often higher than the actual market values. One year, my house was appraised at $30K above what the house was actually worth. The appraiser gave me a few addresses that he used to set the value. However, those houses were waterfront properties. Apparently, he had deliberately selected high value properties to raise the appraisal. That was the only time I ever appealed my tax bill and I won the appeal.

There are exceptions. Appeal hearings can address exceptions, fortunately, in addition to the next election cycle to vote out a bad property tax appraiser.

"I'm a Tax Assessor in Maine". "When I lived in Georgia". "Vote out a property tax appraiser".

????

Where do you people come up with this stuff and think it's a valid answer to a legitimate question?

The Poster asked about a Tax Assessment, in a specific County, in a specific State.

All states are different. Not all Tax Assessors are "elected". Many communities in the USA, use a tax assessment consultant. Some throw darts agains the wall.

The process varies as does the process for appealing a Tax Assessment. It is different in every state in the union.

This is the process in Florida: https://floridarevenue.com/property/Documents/pt107.pdf

The process does not always run smoothly and this was not in FL, but it's similar everywhere. See attached.

[spinner1001]

"I'm a Tax Assessor in Maine". "When I lived in Georgia". "Vote out a property tax appraiser".

????

Where do you people come up with this stuff and think it's a valid answer to a legitimate question?

The Poster asked about a Tax Assessment, in a specific County, in a specific State.

All states are different. Not all Tax Assessors are "elected". Many communities in the USA, use a tax assessment consultant. Some throw darts agains the wall.

The process varies as does the process for appealing a Tax Assessment. It is different in every state in the union.

This is the process in Florida: https://floridarevenue.com/property/Documents/pt107.pdf

The process does not always run smoothly and this was not in FL, but it's similar everywhere. See attached.

My bad since apparently we aren’t allowed to make reasonable inferences.

I guess we will have to wait for Joey Hooten, Sumter County’s property tax assessor, to show up on TOTV to answer the Poster’s question then since no one else has a clue.

[BrianL99]

My bad since apparently we aren’t allowed to make reasonable inferences.

I guess we will have to wait for Joey Hooten, Sumter County’s property tax assessor, to show up on TOTV to answer the Poster’s question then since no one else has a clue.


You should have simply read the thread and you would have found the answer.

[Nucky]

Always appeal. There’s too much room for human hmmm error and monkey business. I was congratulated by a judge in the courtroom for not being lazy and new giving up. Final score, Nucky 18 wins, different counties and towns 3. Well worth my time.

This new house in Wildwood bought 14 days into the new year and I have to pay the full price for the year with no homestead relief just doesn’t seem right. We’ll see in the end!!!!

[ahrens fox]

If everyone is appraised at 80 % then the bill would be about the same as if everyone is appraised at 100%. Additionally, the tax payer is less likely to complain if their property is appraised at 80% because they think that they are getting away with something.