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Question for real estate professionals...(or any appraisers who might be hanging out here)..
When an appraisal is done these days for a lender, is the appraiser including sales of bank-owned properties and short sales or just non "distressed" properties? If so, I suspect that they would be coming in way short of the county appraisals...
It seems that not including them would be insanity since that's where the market is going, and properties will sell for what the market will bear at that time...
Just curious. Duval County (Jacksonville) in Florida will not include any and claim that it is state law to exclude them from property appraisals (tax). Gee, I wonder why? Can you say greed?
For normal residential appraisals (non-tax), appraisers generally include comps that are representative of the local market. If bank-owned, short sales, are significant in your market, they should be included in the appraisal analysis.
Of course, counties and states can set their own appraisal criteria for tax purposes.
Yes, short-sales, foreclosures etc are included in appraisals. It has caused issues in transactions having lower than expected appraisals lately. It can be a definite roadblock if agents don't include them in their CMA's when obtaining listings. It's better to have all the appropriate numbers from the beginning than being supprised with a low appraisal and a transaction falling through later.
The fact is the reason a bank WILL include include the distressed properties to an appropriate extent is that they NEED to protect themselves from a worst case scenario. If the buyer ends up defaulting then the bank is not going to want to be holding the bag for some wholly unrealistic price.
The assessor that is trying to UNIFORMLY AND EQUITABLY set values so that levies can cover expenses associated with running government is NOT going to let some sharp witted disgruntled homeowner use the new rock bottom foreclosure auction price to whittle their taxes down to nearly nothing unless the whole of the tax tract is similarly reassessed and RATES are reset so that the schools are still gonna open and cops can put gasoline in the cruisers ...
Foreclosures and short sales are only included if they are a good percentage of sales. If you're buying a house in a community of 500 homes and only a handful have been foreclosured, they won't include those because that's not what the market is saying/doing. It's a poor sampling. If there were 20 foreclosures year to date in this neighborhood, the appraiser better be including them as that's an issue.
Appraisals have nothing to do with tax assessed values by your county.
Foreclosures and short sales are only included if they are a good percentage of sales. If you're buying a house in a community of 500 homes and only a handful have been foreclosured, they won't include those because that's not what the market is saying/doing. It's a poor sampling. If there were 20 foreclosures year to date in this neighborhood, the appraiser better be including them as that's an issue.
Appraisals have nothing to do with tax assessed values by your county.
What is the purpose of the tax appraisal then? Should it not be to determine market value so the property can be taxed on that value rather than on an inflated bogus value?
The community I'm speaking of (they told me they're not going outside of the subdivision) there were maybe 10 sales in the last year & 2 were bank-owned sales. That's a pretty high percentage.
There are at least a half dozen later built developments right down the street within a half mile that have the exact same units (same builder - same floorplans). One or more is still in developer sales. In those developments they are dumping the new units for 65-75% of the apprasied tax values (prices a bit above the "distressed" unit resales..
The tax appraisals also don't take into account that resale prices most likely include cash back to the buyer and/or closing costs included in the inflated "sale" price...
A fairer system would be to include all sales & bump up the tax rate if they need to. Otherwise, owners toward the bottom end of the market are getting royally screwed on taxes..
Yes, the technology certainly would make it feasible for near instaneous assessor adjustments of virtually all property that is subject to the levy. With appropriate coordination with the governmental units that would need to set the rates (and legislative action to align the intent of tax cap legislation with true values...) then this COULD work.
On a practical level the diffulty would be that falling values with greatly increased rates would result in THE SAME OR HIGHER tsp bills! That way everybody "gets hurt". The way most systems are setup now the more stable homeowner is at least a bit isolated, which seems to also help to keep people from running for the hills as values rise and fall.
Honestly, there is no perfect system of taxation, and some folks will always try to the game things. As long as there is some openness and oversight then folks that do care will be able to make appeals and get really egregious inequities addressed...
What is the purpose of the tax appraisal then? Should it not be to determine market value so the property can be taxed on that value rather than on an inflated bogus value?
The tax assessor can't possibly go into every single house out there. They take blanket values and spread them across a community/subdivision. They have no idea if one house is basic verse another being top of the line upgraded to the max, and they don't care. They use a formula, and that's about it.
In Texas, since we're a nondisclosure state, sales prices are not captured by the appraisal district for assessments unless a home owner disclosed what they bought it for. They can only see mortgage amounts as that's public record. You don't know if they put 5% or 20% down...
The tax assessor can't possibly go into every single house out there. They take blanket values and spread them across a community/subdivision. They have no idea if one house is basic verse another being top of the line upgraded to the max, and they don't care. They use a formula, and that's about it....
Right, our county assessor uses a computerized mass appraisal system. Far too many homes to do individualized tax appraisals. If anyone feels theirs is not fair, they can appeal.
This is actually getting pretty funny....I heard from the Appraiser's office this afternoon and was told my appeal was denied because they couldn't use short sales or bank owned properties as comps...so they came up with the same amount as previously...
I called the state capitol and the Florida Revenue Dept. told me that was crap. The counties had been sent 2 memos in 2008 telling them to include short sales & bank owned sales because that's where the real estate market was going..They e-mailed me the memos so now I'll go round two with the county..
The original appraisal was #125,000; using all comps for just the single debelopment brings it down to $105,000. Using the comps for the other developments within about 1/2 that have the same floorplans by the same builder would bring it down to the 80's...
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It is not greed, it is sanity...
