An assessment represents a certain percentage of the real estate market value of a home, and will be dependent on the county and the town of the corresponding property. Dealing with taxes, let alone trying to understand everything concerning real estate can be difficult and could leave you wondering how to convert an assessment to home value. The assessment percentage can range from 1-100 percent of the value. In Charleston, SC, for instance, fair market value is ideally the price a buyer would be realistically willing to pay for a home, and the county assessor determines that. When reasonably close to the sale price of any area, an assessment is considered an excellent estimate of fair market value. There are three things factored in determining a home’s value including:
- The value of a home compared to others recently sold in the neighborhood.
- The replacement cost of the property with a similar one in the area.
- The amount the property would produce on a rental basis.
Due to the market value fluctuation possibilities, the value of a home can be reassessed every five years. Normally, ASR, (also known as Assessment to Sales Ratio) is what measures the acceptable value of a property. The ASR is determined through the division of the assessed value by the selling price. Note; that the ASR is measured at the average level of the neighborhood median of sales. In Charleston, SC, the assessment ratio for a primary residence is 4 percent. That means that if you have lived in a property for over 50 percent of the year, there are high chances of qualifying for the 4 percent, but this must be applied accordingly and properly. Unfortunately, many homeowners fail to realize they are taxed at 6 percent automatically upon a home purchase when they fail to file an application for the lower rate. Little items like this are only just a part of the difference a knowledgeable realtor brings to the table when it comes to dealing with real estate.
Why Is It Important To Estimate Market Value?
Establishing the market value of a property is the surest way to have greater control over insurance premiums, property taxes, and the refinancing of a home. Here, it is necessary to have a professional appraiser come into play. Remember, you will need a home valuation tool to make informed decisions. Appraisers will assess the condition of a home and ensure its description is accurately reflected on the Assessment Notice. An assessment is considered to be the fairest system of tax burden distribution.
To convert an assessment to home value, local sales activities must be monitored first. In most cases, computerized models are used to gauge the assessed value of local homes. Property value tends to increase together with high demand and low supply of real estate (as Charleston has been seeing recently). In that regard, downtown areas register stronger assessed values given that jobs are often in plenty and space is valued at a premium.
On the other hand, neighborhoods struggling with job opportunities experience weaker property values. Ideally, strong economies like SC have high job creation, translating into strong housing demand. This then further supports advances in property assessment. Normally, the municipality will rely on the assessment to structure tax bases. At times, a real estate property may be assessed incorrectly, and this can lead to an unfair tax burden. In such cases, a realtor can help in comparing the assessment with that of the neighborhood for accuracy and realignment. Tax is then levied against each property in line with the determined value.
Having a home assessed at the full market value makes it easy to understand the assessment and how fair it was. For certainty of what market value your neighborhood is taxing, the assessment must be converted into a market value, and the calculation should be based on a current property assessment for accuracy. Property taxes in Charleston SC are low since legal residences are exempted from property tax used in funding public school operations.
Make No Mistake And Be Certain Of The Value Of Your Home!