What is "assessed value"?

The assessed value refers to the value assigned to a property by a local government authority for the purpose of taxation. This value is used to determine how much property tax the owner will pay. It is typically based on various factors, including the property's market value, but it might not equal the actual market price at which similar properties may be sold.

The assessed value is an important concept in real estate and taxation because it provides a consistent method for local governments to calculate property taxes. Each jurisdiction has its own methods and criteria for determining assessed value, which can lead to differences in property tax burdens across different areas.

Understanding assessed value is crucial for property owners, as it directly impacts their tax obligations. It is important to note that while assessed value can be influenced by market trends, it is not the same as the market value or the price someone might be willing to pay for a property, as these are often determined by supply and demand dynamics in the real estate market. Properties may be bought or sold at prices that diverge from their assessed values due to various reasons, including buyer preferences and economic conditions.