What is a Property Assessment? How is it used?

A Property Assessment also known as an Assessment or Assessed Value is the value of a property that is used for determining the amount of tax placed on a property. It involves the estimation of the market value or fair market value of a property, which is the price it would likely fetch in an open and competitive real estate market. Confused? Let me explain further.

Property assessments are typically conducted by professional appraisers or assessors who have expertise in evaluating real estate. They consider various factors when determining the value of a property, including its location, size, condition, features, comparable sales in the area, and current market trends.

The assessment process may involve on-site inspections, reviewing property records, analyzing recent sales data, and applying valuation models or approaches, such as the cost approach, sales comparison approach, or income approach, depending on the type of property and its intended use.

The assessed value of a property is then used by government authorities or school districts to levy property taxes. The tax rate is usually applied to the assessed value to calculate the property tax amount owed by the owner.

It's worth noting that property assessments can vary depending on the jurisdiction, as different municipalities may have different assessment methods, tax rates, and regulations governing the process.

Additionally, because assessments can vary and in many areas of Broome County and even across NY they haven’t been updated in many years, an equalization rate is used. The equalization rate is used to calculate the relationship between the assessed value and current full value of a property. That, with the tax rate, is then used to calculate the full tax on a property. 

Unless you deal with assessments and property values on a daily basis, you’re probably scratching your head and still confused. Don’t let it bother you. It takes most people a fair amount of time to understand the process and math involved.