Costs
Assessed Value
The dollar value assigned to a property by a local tax assessor for the purpose of calculating property taxes. Assessed value is often lower than market value and is determined by the county or municipality. Your annual property tax bill is calculated by multiplying the assessed value by the local tax rate. You can usually appeal your assessment if you believe it is too high.
Why It Matters
Knowing about Assessed Value helps you budget accurately for your home purchase. Many first-time buyers are surprised by costs beyond the purchase price, and understanding each component prevents unwelcome surprises at the closing table.
When planning your homebuying budget, factor in assessed value early in the process. Ask your lender or real estate agent for estimates specific to your situation and location, since these costs can vary significantly.