Many, if not most, Shelby County property owners were at least mildly shocked by the Assessor’s new 2017 property valuations. Some were shocked much more powerfully, seeing their valuations rise 35, 50, or ever 100% over the Assessor valuation from 3 years ago. There is an informal appeal process described on the Tax Assessor’s site, to help you get started challenging the Assessor’s data. That’s the easiest way to appeal, but still might be a bit daunting. I asked my friend and colleague Brian Mallory, an experienced Realtor and Licensed Appraiser to explain the valuation and appeal process:
A Licensed Appraiser Gives the Lowdown on Appealing Your Property Taxes
When it comes to appealing your property taxes to the Shelby County Tax Assessor, the challenge can sometimes seem daunting. How do I explain that my property is not worth anywhere near what they think it is?
The Tax Assessor uses a mass appraisal tool to define how much your property is worth. This tool “crunches” large amounts of data to determine what 5 sales are the most similar to your property. And then, after the tool makes adjustments to the “comparables”, based on this large amount of data, it spits out adjusted values for those comparables. The adjusted values are then used to value your property. These sales can have occurred over the past 2 years. So, for 2017, sales between 1/1/15-1/1-17.
The results of any valuation are dependent on the credibility of the data that was used. Example: My square footage and bedroom/bath count is completely different from what the Assessor says it is. I even have an appraisal clarifying this. The reason the Assessor has different information is due to its limited data sources. The Assessor’s Office, unless asked to by the Board of Equalization, has never measured your house using a tape measure. No one has physically come out to your house to measure it. The Assessor, during a month when most leaves fallen from the trees, takes overhead pictures of every parcel in Shelby County. These overhead images are used to assist in making the determination of the size of your home, as well as any permits pulled for additions/pools/insurance. However, it can be very difficult to see from the sky that a covered patio isn’t a finished out den with heat/air. You may be paying property taxes on an area that should not even be included in your square footage. An appraiser’s sketch can solve this problem.
You have a right to get a copy of the 5 sales that are being used to value your property. If you go out to the Assessor’s Office on Mullins Station Rd, and pay a couple of dollars, they will print a copy for you. A property tax client of mine went out there yesterday, and was not charged.
Most taxpayers do not have access to the data sources to look up the characteristics/pictures/MLS sheets for the comparables being used by the Assessor (beyond the basic Assessor card on the Assessor’s site). Of course, many people have a realtor friend. They may be willing to print up the MLS sheets for you. But, going beyond this, to get accurate/appraisal data that appraisers use, is not possible for most taxpayers. Are the sales truly comparable and, if not, how do I find truly more comparable sales? The goal is to compare apples to apples. But, finding that apple tree can be difficult.
You do have options to assist you in your goal of lowering your property taxes.
You can hire an appraiser to do an opinion of value on your property, for property tax purposes. As mentioned above, the Assessor values your property going back as far as 2 years. If you choose this route, make sure you choose an appraiser that has experience valuing for property tax purposes, as this is not the same as for mortgage purposes. The appraiser may charge you a fee in the $300-$500 range, depending on the complexity of the assignment. Keep this important fact in mind: the appraiser cannot be an advocate for you, only an advocate for his/her opinion of value. He/she can have no bias.
You can go to Chandler Reports website and pay for a property tax appeal kit, which will cost you about $49. This includes a number of reports that can be helpful.
You can hire a licensed property tax agent, who can be an advocate for you. These agents work on a contingency fee basis. Typically, the agent’s fee is a one-time percentage of the first year’s savings. The taxpayer will then be able to realize the savings over the next 4 years, until the next reappraisal cycle. The licensed property tax agents have the most experience dealing with the Assessor’s Office, communicating with the appraisers from the Assessor’s Office, and achieve the best results.
In conclusion, the system that Shelby County has in place gives the taxpayer many avenues to appeal. From filing an Online Informal Review to appealing your case before the Shelby County Board of Equalization to appealing your case before the TN State Board of Equalization, the taxpayer is not at a disadvantage when it comes to opportunity. The Tax Assessor’s Office is very capable and willing to work with you, as long as you are able to present evidence that supports your opinion. No one has an agenda. The Assessor’s Office wants to get the values right, and it is a matter of presenting more credible data. The Board of Equalization is made up of individuals, appointed by either the Mayor of Memphis or the Mayor of Shelby County, that have been in the real estate industry, whether commercial or residential, and these people are essentially volunteering their time (they are paid a nominal fee for their service) to make sure the system works and taxpayers are provided due process.
Brian Mallory is a TN-licensed principal broker, TN-licensed certified residential appraiser, and TN-licensed property tax agent. He served on the Shelby County Board of Equalization from 2009-2011. He owns/operates:
Mallory Property Tax Advisors – www.ShelbyCountyPropertyTaxAppeal.com