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How is Property Value Determined? |
Who determines the value of your property?The amount of property taxes due is based on several factors. The first step is to determine the "fair market value" of the property. The Board of Assessors is charged with establishing the fair market value, or FMV, of the taxable real and personal properties in Douglas County. Fair market value means "the amount a knowledgeable buyer would pay for the property and a willing seller would accept for the property at an arm's length, bona fide sale." The Board of Assessors does not create property values. Assessors and appraisers merely interpret what is happening in the market place. The appraised value is simply the estimate of what the property is worth. FMV can be calculated by three standard methods. The methods for determining FMV are: - Cost Approach- The cost approach uses actual replacement cost of the building, less general depreciation, plus the value of the land.
- Market Approach- The market approach involves analyzing sales of similar properties to predict the likely selling price of unsold properties.
- Income Approach- The income approach is used for income-producing properties. It involves capitalizing the net income to arrive at a probable selling price for the property.
If you do not agree with the FMV the Board of Assessors establishes for your property you have the right to appeal. This is one of the rights you have in the Taxpayer's Bill of Rights, otherwise known as TABOR. The appeal process can be in front of either the Board of Equalization, who is appointed by the Grand Jury, or through arbitration. If a settlement on the value cannot be reached it may be appealed further to the Superior Court. The Board of Equalization is charged with the duty of fair and equal assessments of value which ensures fairness and equal taxation throughout the county. State law requires all property to be re-evaluated at least once every three years.
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