It was announced that the Hardin County Assessor’s Office has sent out assessment for residential properties. Property owners receiving their 2017 Real Estate Assessments will notice that residential property has increased by 10%. This increase was put on, because of sales of properties that sold in 2016. Hardin County has avoided an increase for over 10 years, but sales of properties were strong in 2016. Odd number years are assessing years and the Iowa Department of Revenue will use the sales data that the Assessor’s Office reports to see if equalization orders are necessary.
Sales for 2016 showed that Hardin County was at 88.8% of what the market was doing. Most residential, commercial, and industrial real estate in Iowa is assessed at 100% of the market value. Putting this into a formula, it showed that there needed to be an 11.93% increase on residential properties in Hardin County. Instead of waiting for the Department of Revenue to send an equalization order out of nearly 12%, the Assessor’s Office increased assessed values by 10%.
Any questions about this process should call the Assessor’s Office at 641-939-8100 between the hours of 8:00 a.m. to 4:30 p.m.
How Does an Assessor Value Property?
Most Residential, commercial and industrial real estate is assessed at 100% of market value. The assessor must determine the fair market value of the property. To do this, the assessor generally uses three approaches.
The first approach is to find properties that are comparable to the subject property and that have recently sold. Local conditions peculiar to the subject property are then considered. In order to adjust for local conditions, the Assessor also uses sales ratio studies to determine the general level of assessment in a community. This method is generally referred to as the MARKET APPROACH and is usually considered the most important in determining the value of residential property.
The second approach to value is the COST APPROACH, which is an estimate of how many dollars at current labor and material prices it would take to replace a property with one similar to it. In the event the improvement is not new, appropriate amounts of depreciation and obsolescence are deducted from replacement value. Value of the land is added to arrive at an estimate of total property value.
The INCOME APPROACH is the third method used if the property produces income. If the property is an income producing property, it could be valued according to its ability to produce income under prudent management; in other words, what another investor would give for a property in order to gain its income. The income approach is the most complex of the three approaches because of the research, information and analysis necessary for an accurate estimate of value. This method requires thorough knowledge of local and national financial conditions, as well as any developmental trends in the area of the subject property being appraised since errors or inaccurate information can seriously affect the final estimate of value.
Non Market Value
Agricultural real estate is assessed at 100% of productivity and net earning capacity value. The assessor considers the productivity and net earning capacity of the property. Agricultural income as reflected by production, prices, expenses, and various local conditions is taken into account.
What is the role of the Iowa Department of Revenue?
The Iowa Department of Revenue assists local governments in making property tax assessments fair and in compliance with the law. It does not collect or use property taxes. It administers an examination which would-be assessors and deputy assessors must pass. It issues equalization orders to county auditors every two years for classes of property. It provides technical assistance and educational programs for assessors and members of boards of review. It issues regulations on assessors, conference boards and boards of review. It assesses all utility and railroad properties. It administers credits and exemptions to property owners. It has general supervisory authority over the operation of the assessors offices and the boards of review.
Why Values Change?
After properties have been appraised, the values are analyzed to ensure accurate and equitable assessments. Iowa law requires that all real property be reassessed every two years. The current law requires the reassessment to occur in odd numbered years. Changes in market value as indicated by research, sales ratio studies and analysis of local conditions as well as economic trends both in and outside the construction industry are used in determining property assessments.
Notification and Appeal
If you disagree with the Assessor’s estimate of value, please consider these two questions:
What is the actual market value of my property?
How does the value compare to similar properties in the neighborhood?
If you have any questions about the assessment of your property, please contact your assessor’s office. A written protest may be filed with the Board of Review which is composed of either three members or five members from various areas of the county who are familiar with local market conditions and trends. The Board operates independently of the Assessor’s office and has the power to confirm or to adjust upward or downward any assessment. An individual may petition to the Property Assessment Appeal Board if they are not satisfied with the Board of Review’s decision. If dissatisfied with a Property Assessment Appeal Board decision, the decision may then be appealed to the District Court. As in the past, a property owner may appeal the Board of Review’s decision directly with the district court and forego filing with the Property Assessment Appeal Board.
Iowa Property Tax Assessment Cycle
Property taxes are not determined by a single individual who assesses your property and sends you a bill. The final tax rate is the result of budgets established to provide services, an assessor’s assessment, a county auditor’s calculations, and laws administered by the Iowa Department of Revenue. Because property assessment involves a series of events that takes 18 months from start to finish, this information will not be able to answer all your questions. It should, however, be able to explain the basic principles and events involved in calculating the property tax rate.