Tax assessment shock is real!

Do you have tax assessment shock and are wondering why–and what, if anything–you can do about it???

A lot of us are! Due to the recent pony express delivery of the 2024 new tax assessments for homes and properties, some went up and some went down… so what’s the deal!? Is it fair? Is it correct? And what can YOU do about it!?

What is a tax assessment and what is it based on?

A property tax assessment is a professional estimation of the market value of residential or commercial real estate.

Key Takeaways:

• A property tax assessment estimates the fair market value of your property.
• Annual property taxes are determined by multiplying the assessed fair market value against the local property tax rate.

So let’s break the terms down and look at the key points:

• A tax assessment is a professional estimation of a MARKET VALUE.
• What is a market value?? Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale (short version definition). In other words, what your home/property is worth in a current local real estate market—not CA nor Seattle nor maybe even the value in a nearby county or the next neighborhood over. It is the values within and specific to YOUR neighborhood/area. It is likely you have heard the term “ALL real estate is LOCAL.”

Why did our tax assessment change?

Let’s say your value according to the county has now increased by 50%–maybe more, maybe less, or maybe it didn’t change at all… NO WAY!  How can that be…?

Well remember the end of 2021 and 2022 when properties were selling for very high values, most over list/asking price? You were shocked. You exclaimed to hubby–“whoa, holy-moly can you believe the neighbor’s home sold for $XXX–They don’t even have HALF the amenities we do! That’s ridiculous. I wonder how much ours is worth now?”

We all watched it happen in true amazement–the prices Buyers were purchasing homes for over the past year and then some were skyrocketing. Buyers were competing left and right; throwing money into the pot significantly OVER the current traditional fair market value because of the lack of inventory of homes/properties for sale… Interest rates were at historical–yes, HISTORICAL–record lows… (a whole other topic for a future blog, lol).

How your tax values were determined

Consequently, THOSE sales are driving your current fair market value and because of this are additionally being used to determine your tax assessment. Remember the definition of tax assessment and fair market value??

Because the sold property prices INCREASED on average 25-30% (which they definitely did–that’s called “appreciation”) and a tax assessment is based on a fair market value…  I think you see where this is going, yes?

But you might say, “I didn’t do anything, I didn’t make any improvements to my property….”

Basically as long as you maintain the property in good condition you are going to stay current with any appreciation/depreciation in value because comparable home sale prices have done the same. In other words, if the market is up–your value is up; if the market is down–your value is down. Or maybe, the market is steady–so your value is steady.

What can you do about the high tax assessment?

The key takeaway and important part here to remember if you are having tax assessment shock, is that if you are unsure of your fair market value you can appeal the assessment. To accommodate an appeal, make sure you have your ducks in a row: contact the assessor in the allotted time to tell them you would like to discuss/review/appeal. This will allow you enough time to gather all of your information/validation before the appeal deadline. Your next step is to give us a call. Let’s have a discussion so that we can assist in providing you with comparable sold property information to determine that fair market value.

You can also reference the Mason County Assessor’s web page for additional and contact information.

We offer a complimentary comparative market analysis SPECIFIC to YOUR property and area that could help with your tax appeal.

We are more than happy to share our knowledge and information regarding the local real estate market and YOUR property fair market value.

Jessica and Valerie Spaulding