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March 5th, 2011

Try this if your house has decreased in value

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new american homeEven if your home isn’t underwater, chances are it may have lost some value of the last few years. If that’s the case, you may be asking yourself, “What can I do about it?” The answer: A property tax do-over.

“Property tax appeals are especially popular among homeowners today due to sharp declines in house values throughout the U.S.,” writes HSH.com contributing writer Marcie Geffner. “The reality is that not all tax assessors have kept up with these trends, which means some homes may be over-valued and thus over-taxed.”

Here’s more from Marcie’s article titled “House lost value? Get a property tax do-over“:

Most, though not all, U.S. states tax residential property, according to John Brusniak, president of the National Association of Property Tax Attorneys in Dallas. Other jurisdictions that also may tax real property include counties, cities, towns, school districts, utility districts, and the like. This myriad of taxing authorities means your first step must be to find out who’s in charge of your property’s valuation. Typically, this information is printed on your tax bill.

Deadlines are inviolable

The other first step (if two such top priorities may be allowed) is to find out the yearly deadlines to appeal the assessment. Deadlines are crucial because the process typically comes to a halt, without recourse, if you don’t turn in the proper paperwork on time or show up for a hearing on a required date.

“There might be some specific small outs in various places, but for the most part, if you blow a deadline, you’re done for the year,” Brusniak warns.

The deadlines might be printed on your tax bill. If not, a telephone call to the assessor’s office or a little online research should produce the information.

Comps trump other data

The next step is to gather data about sales of homes that are comparable to yours. These “comps” should be located in your area, approximately the same size as your home and have similar features. The data points for each comp might include the address, date of sale, sales price, square footage, and amenities. Pictures may be helpful as well.

Comps are important because they’re used to establish your home’s fair market value on a certain date, based on data that’s specific to your property, rather than a function of the “mass appraisal” approach often employed by tax assessors.

“Under mass appraisal, (tax officers) generally value an entire neighborhood based on the data they have and then sort of homogenize the values across all the properties. When (they) do that, (there will be) errors because your property may not be like the properties near yours,” Brusniak explains.

Click here to continue reading this article on property tax appeals.

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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