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Questions and Answers
The property tax is an __________ tax, meaning it is based on value.
The property tax is an __________ tax, meaning it is based on value.
The assessor is responsible for the __________, __________, and __________ of all taxable property.
The assessor is responsible for the __________, __________, and __________ of all taxable property.
The taxable location of personal property is referred to as its __________.
The taxable location of personal property is referred to as its __________.
An estimate of value, usually in writing, of an adequately described property, as of a given date, is termed a(n) __________.
An estimate of value, usually in writing, of an adequately described property, as of a given date, is termed a(n) __________.
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A jurisdiction's tax rate is determined by dividing the __________ to be derived from property tax by the total __________ of the taxing jurisdiction.
A jurisdiction's tax rate is determined by dividing the __________ to be derived from property tax by the total __________ of the taxing jurisdiction.
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The type of value usually estimated by the assessor is __________ value.
The type of value usually estimated by the assessor is __________ value.
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The __________ reflects the ratio between the current tax bill and the property value.
The __________ reflects the ratio between the current tax bill and the property value.
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In order for a property to have value, it must have __________, __________, __________, and __________.
In order for a property to have value, it must have __________, __________, __________, and __________.
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The use that generates the highest net return to a property over a reasonable time period is called its __________.
The use that generates the highest net return to a property over a reasonable time period is called its __________.
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The principle of __________ states that maximum value of a neighborhood is attained when the uses of land are perfectly complementary.
The principle of __________ states that maximum value of a neighborhood is attained when the uses of land are perfectly complementary.
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Which appraisal principle affirms that land cannot be valued on the basis of one use while improvements are valued on the basis of another?
Which appraisal principle affirms that land cannot be valued on the basis of one use while improvements are valued on the basis of another?
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Which of the following are the four tests that the appraiser must make in the analysis of the highest and best use?
Which of the following are the four tests that the appraiser must make in the analysis of the highest and best use?
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__________ is a parcel of land and any structures or improvements that are permanently affixed thereto.
__________ is a parcel of land and any structures or improvements that are permanently affixed thereto.
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Property is considered __________ if it can be moved without causing any damage or change to either the item of property or the structure to which it is attached.
Property is considered __________ if it can be moved without causing any damage or change to either the item of property or the structure to which it is attached.
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Assessment level times the tax rate equals the __________.
Assessment level times the tax rate equals the __________.
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__________ is the point at which the forces of supply and forces of demand meet.
__________ is the point at which the forces of supply and forces of demand meet.
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Highest and Best Use analysis can be conducted under which two scenarios?
Highest and Best Use analysis can be conducted under which two scenarios?
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The typical life cycle of a neighborhood includes:
The typical life cycle of a neighborhood includes:
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What elements of the marketplace are most likely to contribute to a change in demand?
What elements of the marketplace are most likely to contribute to a change in demand?
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Market value is defined as the most probable price of a property in terms of money, assuming:
Market value is defined as the most probable price of a property in terms of money, assuming:
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__________ refers to the amount of goods that producers are willing to sell at a given price during a specified time period.
__________ refers to the amount of goods that producers are willing to sell at a given price during a specified time period.
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Ownership of all legal rights to property is limited by government in four ways:
Ownership of all legal rights to property is limited by government in four ways:
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The seven steps of the appraisal process are as follows:
The seven steps of the appraisal process are as follows:
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The basis for the adjustments in the sales comparison approach to value is the principle of:
The basis for the adjustments in the sales comparison approach to value is the principle of:
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__________ represents the value of a property for a specific use.
__________ represents the value of a property for a specific use.
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The principle of __________ states that value is created by the expected future benefits to be derived from the property.
The principle of __________ states that value is created by the expected future benefits to be derived from the property.
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The six basic rights associated with property are as follows:
The six basic rights associated with property are as follows:
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The ownership of all legal rights to property is known as __________.
The ownership of all legal rights to property is known as __________.
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Determining the identity of the property to be appraised is a part of the __________ step in the appraisal process.
Determining the identity of the property to be appraised is a part of the __________ step in the appraisal process.
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The three types of boundaries used to delineate neighborhoods are __________, __________, and __________.
The three types of boundaries used to delineate neighborhoods are __________, __________, and __________.
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Under the step in the appraisal process that is termed data collection and analysis, specific data include:
Under the step in the appraisal process that is termed data collection and analysis, specific data include:
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The four forces that influence value and must be considered in neighborhood analysis are as follows:
The four forces that influence value and must be considered in neighborhood analysis are as follows:
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The typical life cycle of a neighborhood can be extended or shortened by changes in __________ factors.
The typical life cycle of a neighborhood can be extended or shortened by changes in __________ factors.
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An area of complementary land uses in which all properties are similarly influenced by the four forces affecting value is termed a __________.
An area of complementary land uses in which all properties are similarly influenced by the four forces affecting value is termed a __________.
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Municipal services, planning, and zoning are examples of __________ factors that affect neighborhoods.
Municipal services, planning, and zoning are examples of __________ factors that affect neighborhoods.
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What are the four basic elements of supply?
What are the four basic elements of supply?
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The underlying principle for the three approaches to appraisal is __________.
The underlying principle for the three approaches to appraisal is __________.
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Study Notes
Property Taxes & Valuation
- Property taxes are ad valorem, meaning they are based on the value of the property
- The assessor is responsible for finding, listing, and valuing all taxable properties
- The situs is the taxable location of personal property
- An appraisal is a written estimate of value
- A jurisdiction's tax rate is determined by dividing the budget by the total assesed value
- Assessors typically value property using market value
- The effective tax rate reflects the ratio of the property tax bill to the property's market value
- In order for a property to have value, it must have utility, scarcity, demand, and transferability
- The highest and best use of a property is the use that generates the greatest economic return over time
Appraisal Principles
- The principle of balance states that maximum value is attained when land uses are complementary
- The principle of consistent use states that land and improvements must be valued under the same highest and best use
- The principle of contribution states that the value of a component is measured by how it contributes to the property's value
Real Estate Basics
- Real estate is a parcel of land and any permanently affixed improvements
- Personal property is movable and can be removed without damage to the property
- Equilibrium is the point where the forces of supply and demand meet
Highest And Best Use
- Highest and best use analysis is conducted under two scenarios: as if vacant and as if improved
- The typical life cycle of a neighborhood includes growth, stability, decline, and revitalization
Market Factors
- Demand is influenced by consumer tastes, preferences, income, expectations, and the price of related products
- Market value is the most probable price a property would sell for under typical market conditions
Ownership Rights & Government Limits
- The six basic property rights are: sell, lease, use, give away, enter or leave, and refuse to do any of the above
- The fee simple ownership means complete ownership of all rights to a property
- Government limits ownership through taxation, police power, eminent domain, and escheat
Appraisal Process
- The seven steps of the appraisal process are: definition of the problem, scope of work, preliminary survey, data collection and analysis, highest and best use, application of approaches, and correlation/reconciliation
- In the data collection and analysis step, specific data includes physical data, sales data, site data, and economic data
Neighborhood Analysis
- Four forces influence neighborhood value: physical (environmental), economic, governmental, and social
- Economic factors can significantly extend or shorten a neighborhood's life cycle
- A neighborhood is an area of complementary land uses where properties are similarly influenced by the forces of value
- Municipal services, planning, and zoning are examples of governmental factors that affect neighborhoods
Supply & Demand
- The four basic elements of supply are: cost of production, price of other goods, entrepreneur expectations, and number of sellers
Valuation Approaches
- The principle of substitution underlies all three appraisal approaches: sales comparison, cost, and income.
Additional Concepts
- Anticipation is the principle that value is created by expected future benefits
- Value in use represents a property's value for a specific use
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Description
Explore the fundamentals of property taxes and appraisal principles in this quiz. Understand key concepts such as ad valorem taxes, situs, market value, and the highest and best use of properties. Test your knowledge of how assessors determine property values and effective tax rates.
