How Accurate Are St Joseph County Tax Assessments?

by Nick Molnar on March 8, 2016

If you own a home in St. Joseph County, there’s about a 15% chance you could cut your property tax bill in half by appealing the assessed value of your home.

Everyday, I see homes for sale at prices dramatically different from the tax assessed value. I’ve often had buyers tell me about the great deal they are getting and sellers tell me about the great price they are offering because a sales price is lower than the assessed value of a home. Please don’t ever buy a South Bend area house because you can get it for less than the assessed value. You can do that almost anytime and you might still overpay for the property. There are  20 homes for sale now for less than half of their assessed value.

Obviously there are bad assessments. But to get beyond anecdotal reports and figure out percentages, we need a larger sample of homes. And to get useful information, we need to compare the assessed value to the price at which the homes actually sell (market value). 3,852 homes sold with Realtor involvement in St. Joseph County in 2015. On those homes, 1,626 Realtors included the assessed value in their MLS listing.  Looking at the values of those 1,626 homes,

  • 48.95% sold below the assessed value
  • 51.05% sold at or above the assessed value
  • 56.70% were assessed at 75-125% of their sales price (my self-invented threshold for a fair assessment)
  • 2.28% were assessed at 50% or less than their sales price (severely under assessed)
  • 15.19% were assessed at 200% or greater than their sales price (severely over assessed)

Here is the complete dataset. If these percentages hold for the greater pool of homes in the county, there’s about a 30% chance you are over-assessed at 125%+ of market value. And there’s a 15.19% chance you are severely over-assessed at 200%+ of market value, at which point the relatively inexpensive but very slow process of appealing your assessed value is probably worth your time.

 

 


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