If our home has been recently appraised at a lower valuation than is on the tax rolls, will the county/city assessor adjust the property value accordingly?
They can and often will. But you'll have to take the initiative to make sure it happens. Independent appraisals generally aren't part of public record unless they are included in the recorded property sales that many local governments peruse before making their tax assessments. So absent that, you may have to appear at your local assessor's office with appraisal in hand as part of process known as a tax grievance, challenge or protest.
Most homeowners have an opportunity to challenge once a year during a set period in front of a tax-authority board once they receive their assessments in the mail.
Why the disconnect between a property's estimated sale values and its taxing value? Well, many taxing localities reassess properties to market value only once every two to three years. And quite frankly, most districts have not been in hurry in the last few years to reflect value losses, lest they take a big revenue hit that would force them to raise everybody's property-tax rates.
In fact, real estate Web forums around the country are abuzz with reports of tax values that are
going up even as real estate values drop
--this despite the fact that home values actually haven't increased in a majority of U.S. markets since mid-to-late 2005!
The good news is that most people who challenge their values do get some relief, and your appraisal will serve as part of a good defense.
But to better plead your case, come armed with a half dozen or so "comps," which are records of recent sales of comparable homes within the last 12 to 18 months. These comp sales, records of which are available from Realtors or through your own courthouse research, should be of homes that are roughly the same age, square footage, location, condition and lot size as yours if at all possible.
Ironically, in the flattest of the flat markets and in smaller markets, it may be hard to find enough comps to make your case. Sites such as Propertyshark, Zillow and Trulia may have ones you missed. In some taxing districts, these comps carry more weight than appraisals in challenges.
Since you've already spent money on an appraisal, you have very little to lose by protesting, other than the time spent traveling to and from the assessor's office and the half hour (or probably less) that you'll spend in front of a tax official or officials there.
The National Taxpayers Union estimates that fewer than one in 50 homeowners appeal their assessments, despite the fact that about 60 percent of their properties are overvalued by assessors. So, methinks homeowners protest too little. Go for it.
A tip: As the assessor has the right to ask you for evidence that your home is overassessed, it's also your right to ask the assessor what evidence he uses to determine your value. Not all taxing districts use the same method to measure home values.
Before your meeting, ask the assessor's office how it's done there (i.e., by comp sales, estimated cost to rebuild, percentage of its estimated value or other means.) Tax assessing is an inexact science.
Some states, such as Texas, don't even allow disclosure of final sales prices on county deed records, making it harder for taxing authorities to get accurate readings. Only the loan amount is recorded.