Appraised value versus assessed value

Two real estate terms people sometimes think have the same meaning – that are used in different ways and determined using separate methods – are appraised value and assessed value.

Very basic definitions are as follows:

Appraised value is determined by an appraiser, at a specific point in time in the market, and accounts for external and internal characteristics of a house, the land it sits on, and any other structures on the property. This consists of a detailed analysis of a specific home when compared to other similar homes, close in proximity, that have sold in the recent past. It is intended to reflect, as accurately as possible, a property’s current market value.

Assessed value typically pertains to property taxation. This value is unlikely to be as detailed as an appraisal in that it may not include all internal or external characteristics of a house and land in its valuation. Because assessments are only conducted on a periodic basis that may span one-to-several years, it may not reflect recent changes in the housing market.