Real Property Assessments Real property (real estate) assessed includes land, improvements attached to the land (buildings, etc.) and improvements to the land (driveways, bulkheads, etc.). Mobile homes and floating homes are valued as real property but administered by personal property staff. In Washington State, assessment for tax purposes means establishing the full market value of your land and the improvements on it. This is the job of an appraiser. Appraisal methods used in King County follow basic practices and procedures used in the appraisal profession. Three approaches may be used to determine real property value:
They are: Market: The market data (sales comparison) approach.
Cost: The reproduction or replacement cost new, less accrued depreciation approach.
Income: The income or capitalization of economic rents approach.
All three techniques are applied, if appropriate, in appraising improved commercial and industrial properties. The market and cost approaches are the bases of appraisal of improved residential properties. The value of vacant land is most often determined using the market approach. Whenever the Assessor revalues your property, you will receive a "Valuation Change Notice." The assessment procedure begins with establishing land value. Appraisal theory and state law require land to be valued as if vacant. This value is determined by analyzing sales of comparable bare land. Our next step is to study sales and market trends of improved (developed or built-on) properties in a selected area. This sales analysis is used to determine total market value based on square footage, year built and other characteristics of the property. From this total value, we subtract the amount determined for land. The balance is allocated to improvements. Real property valuations are made by our staff of accredited real estate appraisers. The total valuation represents 100% of fair market value. Market value is the amount of money a buyer, willing but not obligated to buy, would pay to a seller willing but not obligated to sell. For residential parcels, fair market value is determined by analyzing recent sales of comparable properties in the same area. Commercial properties also may be appraised using this method or by using the income or cost approach. The appraisal method used will be the one that offers the best evidence of market value. The Assessor values property on a cyclical basis according to a revaluation plan filed with the state Department of Revenue (external link). At a minimum, real property must be revalued each four years. King County began an annual revaluation program in 1995. When any change in valuation is made, you will be mailed a Value Change Notice. This notice shows your old and new total values and a division of value between land and improvements. (Improvement refers to buildings, structures or enhancements to bare land.)
|
