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Saturday, August 25, 2012

HOW IS PROPERTY VALUE ASSESSED?

"Values in a neighborhood can decrease for numerous reasons: too many listings, foreclosures, short sales, market correction and/or the quality of the neighborhood has gone down. Given enough time, the neighborhood will most likely rebound if it is a good quality neighborhood. However, if values have decreased because the neighborhood has gone to the dogs, then there is little hope for a rebound in price for that neighborhood.
Nadine Cius, Broker, Harris County, TX  (seen HERE)
 
 
 
Foreclosures and short sales have had the most detriment effect on certain neighborhoods. So overall the sale of these properties will impact the other homes that are not foreclosures or short sales. "
 
 
 
"A property assessment is the way the local government determines how much property tax a property owner must pay. The assessment is normally made up of two values.
 
 
• The unimproved or land value of the property
 
• The improved or building value of the property
 
The land or unimproved value is determined by the highest and best usage of the land as if it were vacant and ready to be developed. Land value, governed by the dynamics of the local real estate market, decreases when the supply exceeds the demand and increases when the demand exceeds the supply. Because the land value fluctuates, or has the potential to fluctuate, a yearly property assessment is important as it reflects the amount of taxes a property owner has to pay.
 
The improvement value of the land is determined by Improvements are any fabricated objects that are permanently attached to the land, such as buildings, wells, fencing, and private roads. Anything not permanently attached is personal rather than “real” property. Personal property can include furniture, fixtures, commercial equipment, appliances and even entire manufactured homes which are not installed on a permanent foundation. A yearly assessment is important here because any changes to improved land can cause a property owner’s taxes to fluctuate.
 
 
Therefore, a property assessment is a yearly assessment of the value of improved and unimproved land to determine the amount of taxes the owner of the property must pay to the local government."
 
 
Related:
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 

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