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Knowledge is power.

      And in the business of buying and selling real estate, knowledge in the area of assessments and taxes is critical as local property taxes are amongst the highest in the nation.

      I believe that the most important factor in the mind of a buyer is: how much can I afford per month in mortgage and property tax expense? Sellers, of course, want to know what steps can be taken to maximize offers they may receive.

      The common denominator is property tax reduction. Of course, not all properties are over-assessed but recognizing those which are (that you are listing or showing) can certainly help close the deal. Please feel free to call if you would like me to review the assessments of individual properties or would like to understand the process of doing so.

Other FAQ

Will recently discovered illegal improvements automatically increase the assessment?

      Although assessors are obligated to review these improvements and increase the assessment if appropriate, there may be times when the assessment is not changed. For example, if a property is listed (and will eventually sell) below the equalized value of the current assessment, it shouldn't trigger an assessment increase.

Do contract vendees have the right to challenge an assessment?

      Yes, contract vendees may challenge the assessment of the property in contract. Many times a property will close after grievance day yet an over-assessment is not addressed as the seller may not be motivated to file a grievance and the buyer may not realize that he or she has the right to do so.

What's the difference between Equalization Rates and Residential Assessment Ratios?

      Equalization Rates state the overall level of assessment of all types of properties and are often used to translate assessments to full value on assessment rolls, tax rolls and tax bills. Residential Assessment Ratios (RAR) are established to translate the assessments of one, two and three family homes. The RAR is the appropriate factor to use if you are trying to determine whether these types of properties are fairly assessed.

How are renovations, additions and new homes assessed?

      Any improvement that adds value could trigger an assessment increase. Typically an increase in assessment due to improvement should add only the value contributed by the improvement. New homes are assessed at their full market value multiplied by the RAR (or 100% for municipalities that assess at full value).

In regard to improvements or demolition, is there a way to use the assessment calendar to my advantage?

      Property owners who wish to delay the tax impact of improvements that they plan to make may do so by scheduling the construction around the assessment calendar. For example, in Westchester towns, an addition built in June wouldn't trigger an assessment increase until June 1 of the following year for taxes payable the year after that. Please be advised these dates can vary by jurisdiction.

Can under-assessed homes be reassessed upon sale?

      In municipalities that perform annual updates to maintain their assessment roll at a uniform percentage of value, it's appropriate that a sale be used to determine the assessment. However, in jurisdictions that do not perform annual updates, an assessment cannot be increased simply based on a selling price. However, if an improvement was made without a permit and discovered upon sale, an assessor may increase the assessment to the extent that the improvement has contributed to value.

Is the Basic STAR Exemption changing?

Please feel free to contact me with any other questions.

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Richard D. O'Donnell 2004 - Property Tax Consultant