Understanding assessed value
November 18, 2005
Carson City Assessor Dave Dawley says all homeowners need to do to understand why their assessed values doubled this year is look at “For Sale” signs down the street.
He said the values his office puts on residential property in the capital city are based on the actual sale prices of similar parcels of property.
The value of a piece of property is divided into two separate assessments: the land itself and the improvements on the land. The two are listed separately on the assessment notices which should be arriving this week for most Carson City homeowners.
He said there are two ways of arriving at those figures.
If there are enough “comparable sales” of vacant parcels, he said that is the best way to determine land value.
To find the taxable value of any improvements the city uses a computer program developed by the Marshall & Swift company. The program considers a large number of variables to determine what it would cost to replace the improvements on a piece of property, minus depreciation based on the age of the home.
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Add the two numbers together and the result is an estimated taxable value for a given property. Assessed value is 35 percent of taxable value.
The other way to make the determination starts with the market value of the property, deducts the estimated cost of replacing those improvements plus depreciation. What’s left is the land value. That method is used in areas where there are few vacant land sales.
He said Marshall & Swift this year estimated the replacement cost of improvements went up 22 percent in Nevada. The Nevada Department of Taxation and assessors decided that was too high and set the number at 12 percent statewide.
Dawley said the Nevada Tax Commission estimated land values should be doubled in many areas. But for Carson City his office and the Department of Taxation thought that was too high and set the increase at 30 percent.
He said the important thing for residents to remember is that no matter what the assessed value of their property, the taxes on an owner-occupied home can only increase 3 percent a year. Rental and commercial properties are capped at 8 percent a year but Dawley said they only went up 5.4 percent in Carson City this year.
Area residents can check out their property online at http://www.carson-city.nv.us/Assessor.
– Geoff Dornan