Many consumers confuse a “home appraisal” with a “tax assessment.” Actually, there are a number of different kinds of value, and they are all quite different. Yet, it is important to understand each type of value, and the part it plays in determining what your home is worth.
Home Appraisal
Let’s begin with a home appraisal. Because most buyers today get a mortgage, home sellers need to consider what lenders are willing to lend when they determine a sales price. Lenders do that by ordering a home appraisal by a licensed, independent appraiser. Home appraisals in this area (Newport News, Hampton, Yorktown, Poquoson, Williamsburg, James City County, Gloucester and surrounding areas) generally run between $350 and $450, depending on the size of the home and the scope of the appraisal.
Because appraisers approach value in an entirely different way than buyers (they look backward up to 6 months for sold comparable sales, rather than considering the current competition), home sellers are often surprised (and not always pleasantly!) at the home value numbers reached by appraisers. Professional appraisers typically select 3 to 6 of the most similar properties that have sold within a several mile radius of the subject property in the past 3 to 6 months (with more weight given to more recent comparable sales), and then make value adjustments for any differences (square footage, updated kitchen, special features like fireplaces and porches, etc.).
At Liz Moore & Associates, we offer a complimentary pre-listing appraisal as part of our “No Surprises” program, to help homeowners answer the question “What is my home worth?”
Tax Assessment
A tax assessment, on the other hand, is a totally different benchmark of value. Your assessment is the value that your local government (city or county, depending on where you live) assigns to your property in order to calculate the basis for the property tax it will charge you. In this area (Newport News, Hampton, Poquoson, Williamsburg, James City County, Gloucester and surrounding localities), assessments are generally revisited every 2 years. That is one reason that assessed values often lag behind the market during times (like 2003-2013) when markets are very dynamic and shifting quickly.
Because most Assessor’s offices are understaffed, it is not feasible for them to visit homes and review the interiors before making an assessment, in the same way that home appraisers and real estate agents do. Accordingly, they derive their information from a combination of sources such as a drive by of the property, the last sale price, and permitting information that they have on file.
Experience has taught us that although assessed values can be used as a benchmark, they are rarely an accurate reflection of what a home is really worth based on today’s market conditions.
To learn what your house is worth in the current market, the best first step is to have an experienced local real estate agent perform a complimentary market analysis (“CMA”) for you. There is no cost or obligation. Email us at concierge@lizmoore.com or click below and find out how much your home is worth.
