Monroe County and Rochester NY, are now going through their 4 year cycle of property reassessment. There's been a lot of griping about assessment increases, which seem based more on the peak of the Real Estate bubble, than on the reality of the sub-prime mess.
Adding to all the local excitement, Tom Golisano, founder of Paychex, has had a well publicized fight with his tax assessor. His home value is assessed at $5MM vs his value of $2MM. Mr Golisano has run several full page ads in our local paper telling home owners how to best fight their tax assessment. He points out with assessments: you're "Guilty until proven innocent". In other words: you need to prove the assessment wrong. The assessor doesn't need to prove himself right.
In my review of several articles, online and offline, local and national, and my own experience of challenging assessments twice, I found my Top Ten Tips To Challenge Your Assessment:
1) Should You Challenge Your Assessment? Depends. If you think your home would sell for much more than the assessment, it may not be worth your time and effort. Some people challenge their estimate every time, but it may not be worth the effort and expense for you to mount a challenge.
2) Preparation. You'll have to do research and provide data, information and pictures for documentation to support your case. You'll get what you pay for, in time and money, as well as help. Practice Hard. Play Easy.
3) Find out about your Assessor. Your local assessor's offices has a personality (easy, tough, fair). You can often find out about their attitude by asking friends, neighbors and Real Estate Agents. If your assessor tends to be lenient (66% challengers got reductions in Rochester, NY), it may be wise to contest your assessment. If your assessor is tough, it may not be worth the bother and aggravation.
The numbers for the 2008 Rochester assessment:
- 66,700+ properties in the City of Rochester
- 4,200 (16%) property challenges
- 66% of property assessments successfully challenged
- 6.9% average reduction in assessment.
4) Find out about your Assessment Process. All Real Estate is Local. And All Real Estate Assessment is Local, too. The assessment process varies with jurisdiction. Information and forms to challenge your assessment should be available at your assessor's office, and now often online. Make sure you comply with deadlines and other basic requirements.
- "I'm so sorry. Your time is up."
- "I'd like to help you, but I can't."
- "Have a nice day."
5) Get your Assessment. Although this may seem obvious, in some jurisdictions they make it difficult to find out exactly what your assessment is. You may also need to do calculations in areas not using 100% valuations.
6) Check Home Information. One way to have your assessment lowered is to challenge the description and features of your home. Make sure the square footage, lot size, number of bedrooms and bathrooms and garage size are correct. Might the assessor be counting unfinished space in the basement or garage; or improvements you don't have? Document with pictures when and where possible.
7) Check Comparables. This is how the assessor calculated the value of your home, and your best way to dispute your assessment. In the past you might have used a Realtor to get comparables. Today you can find comparables on Zillow.com, RealEstateABC.com, Eppraisal.com and a number of others. If worse comes to worse, you can get comparables at the assessor's office. Some jurisdictions now have them online. It's suggested you get 3 to 5 homes comparable for: square footage, lot size, age and style. Compare a ranch with a ranch. Most Assessors use computer programs which may not be up to date on the data or the condition, and rely too much on square footage.
Two local high-rise condominiums saw their assessments rise by 20 or 21 percent. The owners hired a property appraiser through their condo board and filed appeals. Their increases were reduced to 13 percent, well worth the investment.
8) Document Condition. Condition can be important in challenging your assessment. At best your Assessor has done an exterior evaluation of your home (Our County has purchase the "Birdeye View" from Pictometry). Does your home need a new roof, a new driveway or other major repairs? Bring pictures and possibly even estimates. Document, Document, Document.
9) Informal Proceedings. Most jurisdictions have informal proceedings. This is usually the best place to resolve issues. Generally when there is an adjustment, the difference between the old assessment and the new assessment is split. Be prepared to:
- Be Professional: Make your case clearly and succinctly (Answer the question,"Why should this house be valued lower?")
- Be Prepared: (Take it from the Boy Scouts) Document your case completely (Photos, estimates, comparables and other documents). Write down what you plan to say. Practice it with family and friends. Make copies for the assessor (The person you meet with often doesn't make the decision there and may need to present it to someone else and justify his decision.).
- Be Polite. Courtesy can go a long way. Remember, you may be the 20th person he's spoken with already today. "You can catch more flies with sugar, than with vinegar."
10) Formal Appeal. Many jurisdictions have a formal board where you can take disputes after the informal meetings and before a court hearing. These formal appeals are often open to the public. You may be able to attend, which should help you in your own preparation. It may be wise here to have the more formal documentation of a Real Estate Agent or a Certified Appraiser ($300-$600).
When all else fails, you can take your challenge to court. You'll have to calculate the court costs in terms of your time, as well as your legal fees.
If you purchase a home below assessment (more common now with the bubble bursting), you can often challenge your assessment right away.
In my challenges, I won both times, with 25% and 50% increase reductions. I haven't been as lucky with my parking tickets.
Posted by: Cliff Jacobson
Adapt Or Die!
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