More work?

[Bob Ipock]

Not trying to scare anyone. in fact your original post scared me. You said that you "won every time". Then you said....".how hard can it be.....it's a limited appraisal"


You have scared me enough with this information from such a learned appraiser.

 

[Oregon Doug]

Yes – I won every time. I ran my own shop, I went out and beat the bushes for assignments… and I got ‘em. Now, if that’s not “winning” in the business world – what is?

Although the limited appraisal defined in the mortgage lending world is defunct (thankfully) it still has import to other uses (we play by a different set of definitions and rules in tax appeal work.)

In the tax appeal process (in OR); the owner/agent’s appeal is based on the hypothesis that the property’s REAL market value (slightly different terms) is overstated on the tax roll. Now the County has a plethora of evidence regarding sales, market trends, neighborhoods, etc… more than any appraiser can ever hope to get, but what the County doesn’t have is an analysis of the specific subject’s market value; usually no one from the County has even seen the property.

An appraiser who inspects the property, identifies the most appropriate comps and performs a simple sales comparison analysis has ‘em beat every time. The appellant wins the appeal by the greater preponderance of the evidence – all with a simple comparison analysis (page 2 of the 1004 form). So yeah, how hard can it be?

Whether the appellant’s tax is reduced for that year or not is an entirely different matter (but it does “reset the clock”.)

It’s just simply another source of business that most appraisers ignore. USPAP and Standards 1 & 2 still apply but not all those lender imposed restrictions. I used to charge about half (a little more) of my standard lender fee for these and a half day fee if I needed to be present at the hearing – it was pretty easy money.

The work is cyclical here in OR (Jan thru MAR), it’s easy and I was a “hero” every time – which led to other work. In the business world – ain’t that winning?


Oregon Doug

 

[Laurie Collins]

Oregon Doug,

We've been approached by an attorney friend to set up shop on some tax appeals. We would initially look at the county tax valuation, see if there was a valid reason to appeal, and then either turn down the request or proceed. What is your advice on fees in working with this type of assignment?

 

[Oregon Doug]

Laurie

I don’t know anything at all about Guam’s RE taxing process but from what you describe… I see three players: The attorney, the appraiser and the property owner.

Your (appraiser’s) fee reflects the time & effort it takes to produce the report at whatever rate ($/hr) you and your client (the attorney in this case) agree to upon commencing the assignment. The attorney can require a contingency fee from the property owner but you, the appraiser, may not – under any circumstance.

As to actual fees, I couldn’t begin to address yours. By way of example: My billing rate used to be $125.00 per hour. If it was an in-town residence, I could inspect the home, pull and run comps, put together a sales comparison analysis with a cover letter and pull it all together in about 2 hours. Thus my fee was $250.00. That’s about half my usual lending URAR fee and a whole lot less aggravation... and no mortgage brokers!

Oregon Doug

 

[Elliott]

Does the appraiser have a responsibility to indicate to the HO that a substantial
reduction in RMV would be necessary before the first dime of property tax would be
saved? Since Measure 50, the AV and RMV gap has grown significantly and its always
worth a call to the local Assessment and Taxation Dept how much of a reduction would
be necessary before the first dime in property taxes can be saved. You might be able
to be right 100% of the time and get a RMV reduction, but it doesn't save the HO any
money.

 

[OSU Beavers]

Elliott, that is true except for the year that new value is added to the tax roll. Then reduction in Real Market Value for the addition also reduces the Tax Assessed Value by the same amount.

 

[rcsone]

I was elected county assessor about six months ago. Plus I have been a fee appraiser since the early '80's. This past May the office went through protesting period. Our tax rate roughly is 10% of Market value for taxable value times 10% which equates to 1% of Market Value. So it follows that if the field assessors(not appraisers....) can rationally get in a mas appraisal system within +/- !0% of real Market Value, then they can effectively be within 1% +/- in fair taxation. The chief appraiser has over 25 years experience, retired twice and joined the office due to not enjoying "sitting on the porch". Between the two of us we probably exceed ALL the real appraiser experience in the entire state in the county assessor offices. All of that introduction was to get to how we handle tax protests or appeals. If we agree with the individual, the figures are changed immediately during the informal protest process. Further if we are furnished an appraisal by "....an acceptable certified appraiser...", we immediately alter the value according to those figures. Finally if no agreement can be reached, the taxpayer is suggested to obtain an appraisal from "...an acceptable certified appraiser...". We make a legitmate effort to verify our challenged opinion or computer listed/assisted value. After the informal process comes the formal protest level with an appeal to the Board of Equalization. Twenty accounts out of 57,000 parcels pursued this remedy. All came to agreement except two - one about $25 vs. 15 M and the other $70 vs. 57 M. I took one to court and the other took me. The court days have not been established. Also in my background is two terms on the state committee that reviews appraisers for license upgrade and compliance. The points of all this include that when we go to court and the Bigs seek to "distance" my figures with "expert" appraisers, I will wave USPAP over my head and SCREAM bias and advocacy. In addition I expect to include a member of the state board to testify about same. We will see. I considered years ago developing a PMI removal sales program. But it, like tax appeal work, treaded in the deep waters of rule intrepretation, so I passed.....by the way most of the appeals were by "professional" people not having any appraiser credientials(based on my most limited experience...)...................best to all..........rs

 

[Six Flags]

My point is not to offer up a junk appraisal to a taxing authority. They can and will file a complaint with the appraisal board when they see fraudulent appraisal reports.

My other point is that most appraisers don't understand the concept of "no bias" in tax appraisal work. The appraiser can never "win". The appraiser can never have a goal of lowering someones tax bill or tax valuation.

Most people on a board of equalization are pretty well versed in seeing un-suported value opinions on both the high and low side of reality. They do not think highly of "hired gun appraisers" who started with pre-determined directions in value.

If you can prove that your appraisal is better than someone else's thats a win. And that, in a nut shell, is how tax appraisals are handled in NJ.