Keller Williams Realty Professionals

Assessment value vs. market value: Understanding the difference

by The Troy Team 05/21/2023

In the world of real estate, you will hear the terms assessed value and market value often. Whether you’re a homebuyer, seller, or simply a homeowner calculating your property taxes, these terms are of high importance. 

What is the meaning of assessed value?

Assessed value is a sum used to determine the property taxes of a property. During the assessment process, a government assigned assessor considers the condition of the home, property location, market conditions and qualities of the home. 

Once they have compared the features of the house, similar properties in the same area and other conditions, they can officially assign a value to your home, which aids in determining property taxes. 

What is the difference between appraisal & market value?

Whereas appraisal value is based on a professionally assigned appraiser’s examination of the home for tax assessed values, market value is created by homebuyers. 

When a property is listed on the market to be sold, the monetary amount homebuyers are willing to pay for the home and what banks are willing to invest constitutes the market value.  

Can appraised value be higher than market value?

Market conditions play a huge role in market value in comparison to appraised value. If there are more sellers than buyers, there’s a higher chance the market value will be less than the appraised value. 

However, if the market is hot and there are more buyers than sellers, your home’s market value may be more than what it’s apprised for.

As you prepare to buy, sell or strengthen your homeownership journey, knowing your market and assessed value can be beneficial for budgeting and gauging a listing price.

About the Author

The Troy Team

Hi, I'm Troy Stevens and I'd love to assist you. Whether you're in the research phase at the beginning of your real estate search or you know exactly what you're looking for, you'll benefit from having a real estate professional by your side. I'd be honored to put my real estate experience to work for you.