NJ Residential Tax Appeal - Competent Appraisers Please Help

[Walter Kirk]

Thanks for the suggestions. Walter can you provide some report ready narrative for intended use/ purpose?

I keep it real simple. I use the AI General Purpose form ( it looks like a narrative but its a simple format) Page 2 of that form has a space for intended user (the property owner or attorney) and Intended use (Property Tax Appeal)

 

[DonRico]

Remember, you are not appealing the Taxes, you are appealing the Assessed Value. You will want to use a phrase like "Appealing the Assessment to bring it into line with True Market Value in this Neighborhood" and quote that definition in your Appraisal.

A word of caution surg -- NJ Municipalities are no longer granting homeowners reduced Assessments just for showing up at the hearing. Most of these towns have a Lawyer on Retainer and they will go over your appraisal with a fine tooth comb. If you make even a minor error on that new unfamiliar Form.....your credibility will be called into question. The company that did the Mass Evaluation will also be there to support their initial Assessment. The value of the Improvements (the house and outbuildings) is very formulaic. X square feet times Y dollars per foot, once the Assessor establishes a Quality rating.....it's plug in the numbers.

The Land Value is where they most often juice the Assessment, there are so few vacant Land sales in this county that the Assessor is extrapolating his value based on a very few sales. You can challenge his opinion with your opinion -- but he has a +/-15% window before he has to reconsider.

And how much are you charging the Homeowner ??? The cost of the Appraisal, plus your day at the Hearing (including Prep Time before) adds up to a considerable Fee. Craft an Engagement Letter that clearly defines what you will be paid, and when you will be handed the check. Do Not work for a percentage of what you save the HO, you will often be working for free.

In Summary, the deck is stacked in favor of the Township. You will have to go the extra mile to prove the Taxman is wrong. About the only way to guarantee a reduction in Assessed Value is to prove that the House was measured incorrectly.

And even if you win a reduced Assessed Value, they will just jack up the Millage Rate and the HO will be back to paying big taxes at the end of the day.

 

[dobie]

...About the only way to guarantee a reduction in Assessed Value is to prove that the House was measured incorrectly.

Depending on what town it is that's not too much of a stretch. In some jurisdictions the property records are filled with errors. And remember the errors can go both ways

 

[idliver]

Idliver-SCGREA

Here are a few suggestions:
1-www.njactb.org website. Go to legal archive and download NJ Assessor's Handbook. It outlines the appeal process with guidelines on evidence.
2-If the appeal is at the commission level a gpar form is fine. If it escalates to tax court, a narrative is recommended.
3-Have back-up and documentation for your adjustment "opinions", ie: Marshall & Swift or contractor estimates. May not be a problem at the commission level, but tax court judges want the "Whys and Wherefores" of your professional opinion. (See Greenblatt vs Englewood)
4-Remember to equalize the true value of the assessment to be sure your value conclusion is "outside the corridor". Otherwise, you're wasting every ones time.
5-Don't cherry pick your data. If your comps are well researched, in the neighborhood, similar style houses, and with similar amenities, and if you have a legitimate case, most assessors will be reasonable and offer you a settlement. If you cherry pick the low comps and advocate for your client/friend, instead of employing appraiser impartiality, the assessor will respond in kind.

6-Don't forget to re-equalize your value conclusion back to the current ratio and calculate the potential savings in a best case scenario. In my experience, you can expect a fair assessor to negotiate toward the half way point, maybe a little more than halfway. If the savings is not significant, don't spend the time.
Good Luck

 

[Tim in NJ]

You guys all gave great advice My 2 cents: Support of Adjustments: Report that you examined xx number of MLS sold properties over the past year to arrive at your adjustment ie Appraiser researched 57 MLS sales over the past 3 years of similar GLA (give GLA range) 25 on busy streets versus 22 on average streets for which resulted in a X% variation in value. Doing your own research is always better than trying to use a canned statement, even though it may be acceptable for lender work. If you've got nothing to hide, include interior photos of the subject and the comps (from MLS). Tax Board likes to look at photos. Check the PRC for errors. I take these jobs on a consulting basis to avoid any violation of accepting an assignment based upon "a direction in value". Set fee for the consult, additional fee if the homeowner is ok with proceeding. That way, if the homeowner has no chance, you've done due dilligence, kept clean and got paid. Parking for Union County Tax Court sucks! Watch your meter!

 

[Rick Kulman]

If the homeowner is not capable of cross examining the municipality’s expert or watching out for you during cross examination be careful. Your testimony will be solely in response to questions asked of you.

If you are not a licensed or certified appraiser you cannot appear before the board as an expert

You will be cross examined by the municipal attorney.

An appeal cannot be filed until the assessment roll is finalized and the owner receives the “green card” sometime in January or February. It must be received by the board on or before April 1

The appraisal does not have to be submitted with the appeal but must be submitted to the board and the assessor no less than 10 days prior to the hearing date.

Your client should be careful in completing the appeal form and in particular to the question about the requested assessment.

It doesn’t matter whether it is a narrative or a form report as long as it covers all the bases. All of your adjustments must be supported – (See Greenblatt v Englewood and other recent Tax Court decisions).

Make sure you know all details of your sale comps and not just what is listed on GSMLS.

Photographs of your subject and comparables will be on a monitor for all in the hearing room to see.

The date of value for a 2015 appeal is October 1, 2014

The intended user can be the property owner as well as all parties involved in the litigation.

The report is to be used for establishing an equitable assessment.

Value sought: Market Value – as of October 1, 2014.

Familiarize yourself with the mechanics and application of the Chapter 123 Ratio. They’re posted on both the Division of Taxation and the Union County Tax Board web sites.

Assessments represent a percentage of market value. Dividing the assessed value by the 123 ratio equals the assessed market value. Increase and decrease the ratio by 15% and redo the calculation using those numbers. There is a 15% upper and lower corridor range. If the appraised market value falls within that range there will be no change in assessment. If the value falls below the upper limit equalized assessed value the assessment will be reduced. If the value exceeds the lower limit equalized value the assessment will be increased.

The Union County Tax Board commissioners are extremely familiar with and knowledgeable of the county real estate market. This is also true of the municipal assessors and the appraisal experts that may be retained. I know them all having had been an assessor in the county within recent years.