Property tax appeal appraisals- Any good advice?

[Jack Hines]

I am working on a building a template for tax appeal appraisals and I am looking for any advice and guidance anyone is willing to contribute. I am planning on using the GP form in WinTotal, it seems to me to be the best fit but I am open to opinions. Any thoughts on SOW, statements, addenda, etc...? I have sought advice from everyone I know locally and have yet to find anyone that has done any tax appeal work..... Thanks for any, and all replies!

PM if you would rather not post....

 

[Paul Isolda]

Have you done many tax appeals up to now? There is not all that much difference to this kind of work except your date of valuation and closed dates of the comparables. Market value is market value so as long as you are using the best data as of the date of valution, you should be ok. Now there are often other issues that come up in terms of how the Assessor looks at certain things compared to how we usually look at certain things. I have a huge problem with a Town I do a lot of tax appeal work in where they changed the valuation method for land a few years ago. If you have enough land fo 2 lots per zoning, it makes no difference if there is any subdivision potential or no subdivision potential, they will assess your land as if you had 2 lots. They also tend to lump finished areas of walk-out basements with above grade living area. These tend to differ from Town to Town with each having it's own little quirks about certain things.

 

[c w d]

Just before I decided to go back to college I was working on gathering information for my county and adjacent counties about tax appeal appraisals. According to my county's property appraiser office all appraisals need to be retrospective to Jan 1st of the current year. There is an informal request made through the property appraiser's office and then a formal hearing in October for which evidence can be presented. Seems simple enough.

However, from a marketing aspect, clients are going to want to get an idea of how much money they can save before they spend money for an appraisal which may or may not help them. This is where I ran into complications. In Florida, property taxes are based on the millage rate and the value of the property. Increases in RE taxes are limited to no more than 3% per year for homesteaded properties. Obviously, increases in property value over the years have outpaced the 3% limit. What is reported on the tax card is what the owner currently pays. The problem is there is no way to know what their millage rate was when they homesteaded the home if it wasn't in the last few years. So, while you can compare what their current taxes are versus what they would currently pay based on the millage rate, there is no way to show them what they would be paying at their current homesteaded rate and value of home if the home has been overvalued by the county. The best I could do is compare what their taxes should be based my opinion of value and the current millage rate versus the county's opinion of value and the millage rate. Depending on when they homesteaded, it will always appear that they should be paying more than what they are.

I spoke with several appraisers at the property appraisers office. Noone would or could provide me information to determine the millage rate when the homeowners homesteaded in order to reflect an accurate difference in possible RE taxes. In order to not be misleading the best I could say is "I don't know how much you could save". And that's no way to market a product.

I don't know. Maybe I made it more complex than it needed to be. But then I went to college and dropped the issue. However, it seems to me that in order to market the product to people who are not specifically wanting a tax appeal appraisal then you're going to have to show them how much they could save versus what they're paying. If you can't do that, then you're SOL.

 

[CSP 49]

Slight hijack but relevant. How does a person market this effectively without creating an advocacy postion in the mind of the homeowner?

I realize the OP is in Ohio but I agree with what CWD said in terms of the craziness here in FL. It seems like we have a new property scheme monthly here in the Sunshine State.

 

[Jack Hines]

Have you done many tax appeals up to now?

Not one, yet.... I have several to do for one client and I am working on building my template to use for them. I have spoke to the local Board of revision and they specifically want the current market value w/ current date as the effective date. I have the bases covered on what the county wants but the main thing I need opinions on is what forms different people include, any special SOW remarks, legalese or statements I should include, USPAP considerations, etc... Just seeking quality advice to complete a quality tax appeal report.....

 

[Vermonter]

Slight hijack but relevant. How does a person market this effectively without creating an advocacy postion in the mind of the homeowner?

You don't.

Regardless the degree of disclosure, homeowners hear what they want to hear and believe if they pay....you work for them.

 

[CSP 49]

You don't.

Regardless the degree of disclosure, homeowners hear what they want to hear and believe if they pay....you work for them.

Let me rephrase. How can you market to homeowners without violating the conduct section of the ethics provision and maintain an image of impartiality?

"must not advocate the cause or interest of any party or issue..."

I haven't put much thought into it but am having a tough time coming up with a way to sell a service offering potential tax savings without appearing to be a homeowners advocate.

 

[SUPERCHICA]

Can Please Any One Help Me, I Was Called Today To Performe A 203k FHA Appraisal. I Though What They Mean? Is That The Same As Any FHA Appraisal. I Just Want To Make Sure I Do The Right Thing.... If Possible, Je Je.. No Serious, Can Any One Help Me Out About This 203k FHA

 

[Terrel L. Shields]

have yet to find anyone that has done any tax appeal work..... Thanks for any, and all replies!

Yes. And my first rule is to NOT APPRAISE IT....I have never "appraised" anything for appeal. I did 3 this year and average 2 - 3 a year before the board of equalization. What I do is IMPEACH the assessor's methods and judgments. Remember in most states, the assessor uses a glorified Cost Approach vetted by an AVM....garbage in, garbage out.
The most common mistakes I have found.

Valuing land and buildings at different Highest and Best Use
Understating the age of the house
Incorrect measurements
Changing the grade level of the house - they get better with age apparently.
Converting Mob. Homes to stick built
Appraising buildings that have been gone for years (last time they field checked in once case was 1994 or 95)
Valuing poultry barns as "average" operational when they were closed (you probably don't have that problem)
Over-valuing a basement or showing a basement as "finished" when it isn't.

When all else fails they "jack up" values using the so-called "neighborhood factor". After a few years this "factor" gets so out of whack, it inevitably leads to certain classes overlapping.... A Grade C (A is best) MINUS 10% was valued for less than a Grade D (a lower grade) PLUS 10%...an insensible result.

One of our forumites who has now tossed in the towel and is leaving the biz, temporarily went to work for our local assessor...His comment...."Biggest bunch of value pushers...skippies..." and he quit after only a couple weeks. His supervisor couldn't resist telling him how much he hated licensed appraisers....

So when BOE is in session, I treat them like idiot savants because most of them are. Skippy kowtows to MBs. Instead of MBs, Asssessors kowtow to Superintendents and county officials desperate for money....Wanna bet next year our assessments GO UP????

 

[Jack Hines]

Terrel,

Great post and most of all, great advice..... TY