Presentation of the Opinion of Value is critical to winning your case. The property tax appeal process is based on the expressed “fair market value” as of the lien date. The development of this value must be supported by market knowledge and the taxpayer/consultants analysis and conclusions. Many appeals are lost due to the applicant failing to clearly state their opinion of value. As a result of the imprecise nature of property appraisal and valuation usually the appraiser provides value conclusions that are in a range. The Assessment Appeals Boards take a dim view of value ranges, applicants typically fail if they do not state specifically their position on value.
The opinion of value must take into account the law and it’s limitations regarding the admission of supporting evidence. Quite often the applicant is advocating an opinion of value 12 or 24 months after the lien date for which the assessment was set. With this delay in processing the appeals the market can shift dramatically. During economic downturns this can limit the taxpayer’s relief. In California, sales comparables that occur more than 90 days after the lien date are not admissible
The applicant must also be prepared to challenge the assessor’s evidence and stated position. Often the assessor’s case will include many comparables that are not truly comparable to the subject property. The applicant must question these comparables and the adjustments that are required.
Common adjustment issues:
Rental Rates
Vacancy and Collection
Operating Expenses
Reserves for Replacement
Capitalization Rates
Size, Age and Quality
Time Adjustment
A thorough convincing case demonstrating your knowledge of valuation principles and a solid conclusion is the most effective way to have success.