Hoping for a Tax Assessment Reduction in 2011?

City Assessor Advises Commercial and Industrial Property Owners to Take Action

If you only have time to do one thing in the next week, file an income and expense statement with your local real estate assessing office informing them of the current ability for you to lease your commercial or industrial property in today's market.  Even if you own and occupy your property you should be current with asking rents, rental concessions, vacancy rates, tenant fit-up expenses and operating expenses for similar properties.  Call your local assessor and find out how you can provide his or her office with income and expense information about the type of property that you own.

Assessors can and often do reflect current real estate market conditions using what valuation experts call the "income approach to value."  But in order to consider this approach your local assessor needs to know how your property and competing properties are fairing in today's market.  So this is not only a plea for you to provide such information to the local assessor, but other commercial and industrial property owners as well.  It stands to reason that an assessor will be swayed by strong evidence that indicates prevailing market conditions more than just a few instances of the lowering of rents and high vacancies.

In some states, like Virginia, if the local assessor asks for income and expense information and you did not comply with the request neither the assessor, the income approach to value can not be considered in the assessment review and appeal process by the assessor, Board of Equalization, or circuit court.  As such you are left only with construction costs and comparable sales approaches to value.  Don't eliminate this valuable approach!

Most assessors have downloadable income and expense statements available on their websites.  Unfortunately there is very little standardization in the real estate assessment field at this time.  So don't use a statement from another assessor’s website.

If you would like more advice, tips, and suggestions about real estate assessments subscribe to our Property Assessment e-Alerts or check back at this Property Assessment blog often.  You'll understand how assessors do their jobs and how to take constructive action when they don't.

Comments

[Klinnehan]

If you have noticed your property taxes have gone up an abnormal amount I suggest you take a look at your assessment of your house for the past year. Assessors have been improperly evaluating homeowner's property for some time now. If you find you are overpaying due to your assessment value read the book, "Are you getting screwed on your property taxes?" by Patricia Quintilian. This book lays out in simple step by step format how to go about appealing your over charged property tax. This book saved me and my family hundreds of dollars. It will change your life!

[Richard L. Sanderson]

Thanks for the book suggestion. While I can't agree with a general statement like "assessors have been improperly evaluating homeowner's properties for some time now," I do encourage all property owners to investigate their assessments and challenge them if the believe the assessment to be unfair.

[omaha houses]

Great Information today there are so many people are struggling with property taxes. I have sold several properties (short sales) and below the assessed value. The new owners plan to use statistical evaluations and compositions..

[Richard L. Sanderson]

Omaha Homes: Thank you for your comments. Some short sales are disqualified by local assessors. Recommend that your clients check with the assessor: (1) about what is considered an "arm's length transaction"; (2) the effective date for the last assessment; and (3) the time period studied for determining the latest assessment. The "statistical evaluation and compositions" will need to take all three into consideration in order to be effective.