Appraisal and assessment prices are frequently mistakened for one another. As a home buyer and home seller, it is helpful to distinguish the difference between these terms. A comparison of MA appraisal and assessment prices can be found below.
Definition Of Assessment Prices
Municipalities levy a tax on residential homes. The amount is derived from a percentage times an assessed value of a home. Assessments are created strictly for calculating taxes and do not actually reflect the real estate market price. Every town figures assessed value using different formulas. They traditionally include the amount of land, interior living space, and exterior amenities such as sheds. Municipalities can re-assess property values and/or increase the property tax calculation on an annual basis.
Definition Of Appraisal Prices
An appraisal is a calculation of the market value of a property by a trained professional using approved methodologies. Lenders employ appraisers to confirm that financing is not being issued for higher than the current market price of a property. It is a way of protecting their investment given that they bear a large portion of the risk until you pay down the loan. Appraisers always evaluate several similar homes that sold within the last 6 months in the same or similar town. Since the market will vary very quickly, reviewing recent sales is critical for a valid appraisal.
A Comparison Of MA Appraisal And Assessment Prices
The actual price of a property is defined by what a home buyer is offering to pay, which can adjust continually based on factors such as the economy. Consumers should use caution when comparing assessed values with the market price of a property since they do not adjust in tandem. Some municipalities infrequently alter assessments and traditionally increase tax rates instead. Only an appraisal can provide an accurate indication of current market price. This blog regarding a comparison of MA appraisal and assessment prices was compiled by John Wells at Century 21 Wellsco. For additional guidance on this and other related matters, contact John at 978-518-1481 or firstname.lastname@example.org.