Assessed value is the official value your local tax assessor places on your property. It's the number that determines how much you owe in property taxes each year.
Here's how it works: Your county's appraisal district reviews properties and assigns each one an assessed value. They then multiply this value by your local tax rate to calculate your bill. A higher assessed value means a higher tax bill. A lower one means you pay less.
In Texas, assessed value typically equals market value (what your home would sell for).
In California, Prop 13 limits assessed value increases to 2% per yearâunless you've recently purchased or made major improvements. This is why two identical homes on the same street can have wildly different property assessments.
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Your assessed value is the single biggest factor in your property tax bill. If your county overestimates it, you're overpayingâsometimes by hundreds or thousands of dollars per year.
The good news? You have the right to challenge it. If your assessed value is higher than your home's actual market value, or higher than similar homes nearby, you may have grounds for a successful property tax appeal.
Let's say your county assesses your home at $450,000. Your combined tax rate is 2.5%.
Your annual property tax bill: $450,000 Ă 2.5% = $11,250
Now imagine your home's actual market value is closer to $400,000. If you successfully appeal and lower your assessed value:
New bill: $400,000 Ă 2.5% = $10,000
Annual savings: $1,250
That's money back in your pocketâevery single year.
Check your potential savings in 60 seconds.
Your county's appraisal district determines assessed value by analyzing recent home sales, property characteristics, and local market conditions. They typically reassess properties annually in Texas and upon sale or improvement in California.
Yes. If you believe your assessed value is too high, you can file a property tax appeal (also called a protest). You'll need to show evidence that your home is worth less than the assessed amount or that similar properties are assessed lower.
Market value is what your home would sell for on the open market. Assessed value is what your county says it's worth for tax purposes. In Texas, these should be equal. In California, assessed value is often lower due to Prop 13 limitations.