Appraisal and assessment values are commonly mistakened for one another. As a home buyer and home seller, it is helpful to understand the difference between the two. A comparison of Philadelphia appraisal versus assessment values can be found below.
What Are Assessment Values
Municipalities levy a tax on residential real estate. The amount is based on the tax rate times an assessed value of a home. Assessments are used strictly for levying taxes and do not by any means reflect the real estate market price. Every locality calculates assessed value in a different manner. They usually include land value, interior square footage, and exterior features such as sheds. Municipalities can re-assess property values and/or adjust the property tax percentage yearly.
What Are Appraisal Values
An appraisal is a calculation of the current value of a home by a authorized professional implementing approved procedures. Lenders use appraisers to validate that financing is not being provided for higher than the current market value of real estate. It is a way of evaluating their investment since they hold most of the risk until you pay down the mortgage. Appraisers traditionally pull a few comparable listings that sold recently in the same or similar area. Since the real estate market can change constantly, evaluating recent sales is critical for a valid appraisal.
A Comparison Of Philadelphia Appraisal Versus Assessment Values
The market price of a home is defined by what a purchaser is willing to pay, which can go up and down at any time based on circumstances such as availability of options. Buyers should use caution when equating assessed figures with the price of a home since they do not fluctuate the same. Some cities infrequently alter assessed values and traditionally increase tax rates instead of valuations. Only an appraisal can provide a true indication of market value. This blog regarding a comparison of Philadelphia appraisal versus assessment values was prepared by Diana Escobar-Wachter at Access Abstract Corporation. For additional information on this and other real estate topics, contact Diana at 610-461-2910 or wachterd@accessabstract.com.
