Assessors determine the taxation value of properties by the following valuation methods:
1. Sales Comparison Approach
This method estimates the market value of a property by comparing your property to similar properties that have sold. The sale prices of the comparable properties are then adjusted to your property for any differences in site and improvement characteristics.
2. Cost Approach
This method determines value of a property by using a formula:
Value of Land + Replacement Cost of Improvements New – Depreciation = Value
This is the most common method used to assess properties for mass valuation purposes.
3. Income Approach
With this method of assessment, the appraiser analyzes the income stream of a property to determine market value. This method is only used to determine value of commercial properties.