Tax appeals · Updated July 2026
Assessed value vs. market value
Your home has two official prices, and they rarely match. Market value is what a willing buyer would pay a willing seller today. Assessed value is the number your county puts on the tax roll — produced by mass-appraisal software, often lagging the market, sometimes deliberately set at a fraction of market value by state law.
Most of the time the gap is harmless trivia. It starts costing you money in exactly one situation: when the market value your assessment implies is higher than what your home is actually worth. Then you’re paying taxes on value that doesn’t exist — every year, until someone objects.
What assessed value actually is
Counties can’t send a licensed appraiser to every home every year, so they mass-appraise: statistical models sweep thousands of properties at once, adjusting last cycle’s values by neighborhood trends. The output is your assessment — a defensible-on-average estimate that can be badly wrong about any individual house.
Many states then apply an assessment ratio. Illinois assesses most property at a third of market value; Georgia at 40%; Michigan at half. Your notice may also show exemptions, caps, and an "equalization" factor. The paperwork varies, but underneath every assessment is an implied claim about your home’s market value — and that claim is what you’re allowed to challenge.
What market value actually is
Market value is a specific, defined thing in the appraisal world: the most probable price your home would bring in a competitive, open-market sale with informed parties and no unusual pressure. It’s established by evidence — recent sales of comparable homes, adjusted for the differences between them and yours.
That’s also why a Zestimate isn’t a market value opinion anyone will act on. Automated estimates are mass-appraisal too, just with a friendlier interface. When a number needs to hold up — to a tax board, a court, the IRS, or a lender — the standard is an opinion of value from a licensed appraiser, documented under USPAP.
Why the two numbers drift apart
Assessments lag. Reassessment cycles run one to several years, so a cooling market leaves assessments stranded above reality — the classic over-assessment setup. Mass models also miss house-specific problems: the foundation issue, the dated kitchen, the busy road, the layout only a floor plan reveals.
Caps and ratios add another layer. Growth caps (California’s Prop 13, Florida’s Save Our Homes, Michigan’s Proposal A) can hold taxable value far below market — great for long-time owners, and precisely why recent buyers, whose caps reset at purchase, are the most likely to be over-assessed relative to neighbors.
- Cooling market + slow reassessment cycle = assessments above reality
- Mass models can’t see condition problems or unpermitted quirks
- Caps reset at purchase — recent buyers carry the freshest (highest) values
- Ratio math obscures the market-value claim buried in your notice
When the gap costs you — and what to do
Work out the market value your assessment implies (divide by your state’s assessment ratio if it has one). If that number is meaningfully higher than what your home would honestly sell for, you likely have an appeal case — and the annual savings from correcting it repeat every year the correction stands.
Every appeal board runs on the same fuel: evidence of market value as of the assessment date. That’s a licensed appraisal’s entire job description. Before spending real money, though, it’s worth an honest check of whether the numbers are actually on your side.
Questions people ask
Often, by design — many states assess at a fraction of market value, and caps hold long-time owners below market. That’s why the comparison that matters is the market value your assessment implies (after ratios) versus what your home would really sell for.
No — buyers, lenders, and appraisers ignore it. It’s a tax number produced by mass appraisal, not a market opinion about your specific house.
A licensed appraisal is the standard: comparable sales, adjustments, and a signed opinion of value that boards, courts, and the IRS accept. Automated estimates are a starting hunch, not evidence.
We’re not an AVM, a computer model, or a real-estate agent estimate. Every report is prepared under the Uniform Standards of Professional Appraisal Practice (USPAP) and signed by a licensed appraiser in your state — the same qualification required for mortgage appraisals.