How Does the Assessor Value Rental Property?
Three methods are available: Cost Approach – First, the value of the land is estimated, as if vacant. The Assessor than adds the amount it would take to replace your structure with one of similar utility, including current costs of materials and labor, profit, overhead, permit fees, and the like. If your structure is not new, the Assessor then approximates depreciation from all causes, and subtracts that from the calculation of replacement cost. Market (sales comparison) Approach – Your property is evaluated based on comparable properties that have recently sold, and adjusted for differences, such as a garage, finished basement, or better location. Where there are frequent sales and similarities in properties, this can be the most reliable approach for residential property. Income Approach – This approach works well for apartments, shopping centers and office buildings. The Assessor estimates potential gross income from rentals, then subtracts an amount for vacancies and operating expe
