The difference between an assessment and an appraisal is significant. The two words are not interchangeable, contrary to popular thought. A look at each of these terms will show two very different looks at your home’s value.
An appraisal determines the market value of a specific home at a specific time. The appraiser determines this value based on recently sold homes within the past 90 days. They are of equal (or similar) comparison and are located within approximately one mile from your home. Adjustments are made for differences that might include location and square footage as well as the number of bathrooms.
An assessment, on the other hand is notably different. It is determined by the town or municipality to set property taxes. The amount of taxes you’ll pay is based on the assessment. But here’s the thing: the number is based on stats from previous fiscal years.
For example, a home sold in 2016 has a tax assessment based on sales from 2013 or 2014.
In a nutshell, an appraisal is based on very recent sale prices and are used to determine value. Assessments are based on the past and are specifically used for taxes.
I hope this helps clear up any confusion. If you need further clarification, please contact me at 617-965-1236.
Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.