Short Answer
Assessed value is what your local government uses to calculate property taxes. It is determined by the tax assessor using a formula that may not reflect current market conditions. Market value is what a willing buyer would pay for your home in the current market. Assessed value is often lower than market value, sometimes significantly. The two values can differ because reassessments happen infrequently, while the market changes constantly.
Assessed value and market value serve different purposes and are calculated differently. Assessed value is determined by the county tax assessor for the purpose of calculating property taxes. The assessor uses mass appraisal techniques, considering factors like property size, location, and recent sales in the area. Assessments are typically done on a schedule, often every one to five years, depending on the county. In New Jersey, property assessments are supposed to reflect fair market value, but because reassessments are not done annually in every town, the assessed value can become outdated. Market value is what your home would sell for today, determined by what comparable homes have recently sold for and current market conditions. Market value changes constantly based on supply, demand, interest rates, and economic conditions. If you are appealing your property tax assessment, you need to provide evidence that your assessed value exceeds your market value. A comparative market analysis from a real estate agent or a formal appraisal can support a tax appeal.
Bob's Advice
Redfin Senior Agent · AI Certified Agent
I get asked this question all the time. Your assessed value is what the tax man says your home is worth. Your market value is what a buyer will actually pay. They are often different, and that is normal. If you think your assessed value is too high and you are paying more in taxes than you should, I can help you prepare a market analysis to support a tax appeal. Many South Jersey homeowners have successfully reduced their assessments with the right data. Let me know if you want me to look at your assessment.
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