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Old 10-29-2009, 10:32 AM
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Default Market Value versus Assessed Value

Hi All,

We have been searching for a house for quite some time now. The areas that we've been looking at include Readington/Raritan Twp/Clinton in Hunterdon County and Long Valley in Morris County. I've been under the impression for the most part that assessed value placed by a town should be or is very similar to their market value.

Case in point, when we sold our home in River Edge (Bergen County) the sale price was very close to what River Edge assessed our home value. Some of these homes in the areas that I looking at are asking $600k+, however the assessed value is only in the mid $400's. Am I looking at this completely wrong. I know when you purchase a new home (according to my RE) the taxes are based on the sale value.

Thanks for any guidance you can provide.
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Old 10-29-2009, 12:27 PM
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It depends when the town last reassessed. Call the Tax Office in the towns you are looking at and ask. If the sale prices seem far off from the tax assessment, then they probably haven't reassessed for a while and they might be reassessing soon in the future.

Keep in mind, reassessment doesn't mean your tax bill will go up (or down). It depends on what happens in the rest of the town.

Example, if you're in an older house that is assessed below market value in a town that has had a ton of new construction that is assessed at its value when it was built, then your taxes might go up.

But if the whole town is the same age, even if they reassess your taxes may not change all that much. Your taxes are (value of your house/value of whole town)*Town's budget.

When you buy an existing house (unlike new construction), they don't just up your reassessment to the purchase price that you pay, they have to do the whole town together.
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Old 10-29-2009, 05:11 PM
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Location: NJ
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When i bought my house in 06, the assessed value was only about 20% of the market value of the house at the time. My taxes are about 9k.

You can see the current taxes and assessed value of just about any house in NJ through here.
NJ Tax Records Search
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