A very common question home buyers are asking. The city-assessed value (which is clearly an estimate) is posted publicly for everyone to see. More often than not, the city-estimated value is quite different than the ‘listing price’ or the eventual sold-price.
Is there any correlation between the two? Can, for example, the sold-price be predicted from the city-assessed value?
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How accurate are city assessed values for homes and condos?[00:00:08] This is actually a very common question I get from home buyers. They see a house listed at, let’s say, 300,000 dollars and then find the city assessed value is just 250K. What’s going on? The house is grossly overpriced, right? [00:00:23] So here’s what’s happening. The city assessed value is simply an average for that type, style, size and age of home in that particular neighborhood. Since the city in all likelihood has never stepped foot inside that particular home, they wouldn’t know that the owner recently replaced all the windows, upgraded the heating and cooling, installed all new flooring and repainted inside and out. [00:00:45] None of those things require building permits, so the city has no idea that that’s been done: so that this home would be above average when compared to others in the area. Now this can also happen the other way around, and a house which is city assessed at 255,000 might hit the market with the listing price of 220. In that case, the original owner might be selling the house in all its original glory with galvanized plumbing, knob and tube wiring and the walls filled with newspaper clippings pretending to be insulation. [00:01:16] The bottom line is: don’t rely on city assessed value (i.e. an estimated average) to guide you as to the proper market value of any home.
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