Price Land Using Assessed Value

How to Price Land Using “Assessed Value”

How to Price Land Using Assessed Value

 

Whether you are sending out a mailer and need to determine an offer price, or you have received a call from a seller and are trying to calculate the market value of their property, many individuals incorrectly turn to the “assessed value” as a starting point. Because this information is easy to obtain and comes from an official county department, many feel that the figure (dollar amount) is highly credible. But the fact is:

Using assessed value is NOT the way to value a property.

Assessed value is only a means of determining a value for tax purposes and can be disputed by property owners. Every property owner is mailed an annual notice from the county (usually a postcard) and the assessed value is listed as well as appeal instructions. Many factors are used by county assessors to reach their valuations, such as: sales comps, supply and demand, location (downtown or rural?), neighborhood trends, services, and more. With so many elements being considered it is easy to see why specific property estimates can be inaccurate. So the assessor gives the property owner the option to ask for a re-evaluation each year.

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Here are two examples of properties showing the vast differences between assessed value and market value:

Acres:9.40County Use:VACANT LAND (0000)

San Bernardino County, CA

Total Value:$3,731Assessed Year:2015Property Tax:$46.73
Recording/Sale Date:09/21/1984 / 
Sale Price:$11,200  
Munic/Township:BARSTOW 
        

After researching today’s comps from sites like LandWatch, LandandFarm, and Zillow, the average asking price for 10 acre parcels in Barstow, CA is between $10,000 and $15,000. The assessed value prices the property at $400 per acre. Yet, the market value starts at $1,000 per acre.

What a difference!

In the first example the assessed value and tax base is much lower than what the property’s market value reflects.

Here is another example of a Colorado parcel illustrating the other extreme:

Acres:4.03County Use:RESIDENTIAL LOTS (100)

Costilla County, CO

Total Value:$3,546Assessed Year:2014Property Tax:$51.92

Today’s comps on the same sites value this property as a low as $2,500. That means the assessed value is $880 per acre yet market value is only $620 per acre.

When speaking with sellers I have a list of standard questions that I ask about their property. One question that is not on my list? “What is the assessed value?” Why? Because as I have shown, it does not matter. The true value has always been and still is – what buyers are willing to pay!

Another interesting item to note is that the examples used are unimproved, vacant land. The disparities found in improved lots (lots with a house or structure) are even more pronounced! And remember the crazy recession a few years back? Property values were all over the place!

The question of assessed value versus market value is a common one that I hear from our Land Academy community members as well as our LandStay wholesale buyers. Now that I have addressed why using assessed value does not work, the next logical question is “what is the best way to value a property?”

I guess you will have to read my next blog.

Cheers!

Jill

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Land Academy PRO is the brainchild of founders Steven Jack Butala and Jill DeWit. Designed at the request of Land Academy members who are ready for a higher level, we’re excited to continue to provide the tools and support needed by professional investors.

Each level comes with a preset amount of included data, Concierge Mail service, and postage. For example, the Green level includes 6,000 units of completed-for-you mail completely out the door at no extra cost to you.

All levels include a PatLive introduction and preset script (we will set up your phone answering for you), use of Land Academy’s personal Transaction Team to manage your deal flow, an AirTable (CRM) base setup managed by our (and your!) Transaction Coordinator, personal consulting, regular office hours, and includes your Land Academy subscription cost.

If you’re making this a business, Land Academy PRO takes the work off of your plate so you can focus on the things that matter – like running your business.

Green

$10,060

per Month

Silver

$14,590

per Month

Gold

$19,120

per Month

Platinum

$23,650

per Month

Black

$28,180

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
6,000 mailers 9,000 mailers 12,000 mailers 15,000 mailers 18,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value $500 value $500 value $500 value $500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value $7,500 value $7,500 value $7,500 value $7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value $100 value $100 value $100 value $100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
- - $1,000 value $1,000 value $1,000 value
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value $2,500 value $2,500 value $2,500 value $2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value $150 value $150 value $150 value $150 value
FREE Career Path Access
$23,000 value $23,000 value $23,000 value $23,000 value $23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value $300 value $300 value $300 value $300 value
Subtotal: $8,550 value $8,550 value $9,550 value $12,050 value $12,050 value
Mail Value: $7,500 value $11,250 value $15,000 value $18,750 value $22,500 value
Total Value: $39,050 $42,800 $47,550 $53,800 $57,550
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Green

$10,060

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
6,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
-
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value
FREE Career Path Access
$23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value
Subtotal: $8,550 value
Mail Value: $7,500 value
Total Value: $39,050
Apply Now

Silver

$14,590

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
9,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
-
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value
FREE Career Path Access
$23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value
Subtotal: $8,550 value
Mail Value: $11,250 value
Total Value: $42,800
Apply Now

Gold

$19,120

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
12,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
$1,000 value
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value
FREE Career Path Access
$23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value
Subtotal: $9,550 value
Mail Value: $15,000 value
Total Value: $47,550
Apply Now

Platinum

$23,650

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
15,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
$1,000 value
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value
FREE Career Path Access
$23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value
Subtotal: $12,050 value
Mail Value: $18,750 value
Total Value: $53,800
Apply Now

Black

$28,180

per Month

Concierge Data+ (with data) Included mailers each month (data + concierge + mailer + postage). Our team will do your data for it and get it out the door.
18,000 mailers
PatLive introduction at no cost We will help you establish your first script and get PatLive set up on your behalf to answer your phones.
$500 value
Transaction Coordinator Use of our personal Transaction Coordinator team to manage your deals. Trained and ready to go!
$7,500 value
AirTable Ready-for-you CRM managed by your personal Land Academy Pro Transaction Coordinator
$100 value
Personal Consulting 1 on 1 personal consulting with our Transaction Coordinator each week.
$1,000 value
Regular Office Hours Regular office hours with Jack and Jill + our staff. Private for LA Pro Members Only. (Think Career Path Office Hours)
$2,500 value
ParcelFact ParcelFact is included in your LA Pro membership with unlimited pulls.
$150 value
FREE Career Path Access
$23,000 value
Land Academy No more separate charges - Land Academy is included with LA Pro Membership. This includes all education, tools, support, and future releases.
$300 value
Subtotal: $12,050 value
Mail Value: $22,500 value
Total Value: $57,550
Apply Now

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