Q. What key property characteristics are used to determine property value?
Location! Location! Location! You've heard the saying and it is true that the location of a property is the most significant characteristic of real property which drives its market value. We also consider the size and topography of the land; age of the structure; the style of the home, one-story, two-story, bi-level, split-level; the number of square feet of finished living space; the quality of construction; number of rooms, bedrooms and baths; car storage; basement size and finish; fireplaces; air conditioning; other exterior features or structures as well as the overall condition of the improvements.
Q. What are comparable sales?
For a property to be considered for use as a comparable sale, it should include characteristics similar to the property being appraised. It should be located in the same marketing neighborhood or one with similar characteristics. It would also be competitive with the subject property if both were offered on the market at the same point in time, attracting the same potential buyers. To be considered as a comparable sale, the sale date must also occur during the time period being examined. In the case of an appraisal for tax purposes in Ohio, the relevant period is the two years prior to the valuation date.
Q. What are the differences between a bank appraisal and a mass appraisal?
The primary difference is how the work is organized. Instead of performing an appraisal from beginning to end for each single property, as is done for a mortgage appraisal, mass appraisers break down the process into its components for efficiency. For example, we gather data for all properties before beginning to set final values. Also, an appraisal for tax purposes always has an effective appraisal date of January 1 of the year for which the appraised value is being set. The appraisal techniques employed are identical. Below is a chart which details some of the other major differences:
|Analyze 3 years of sales
||Utilize sales no older than 3-6 months
|Inspection-majority of properties exterior only
||Inspection-interior and exterior usually required
|2 - 2½ years to be complete
||2 - 3 days turnaround
|Equalization with other properties is required
||No equalization necessary
|Testing of results required
||No testing necessary
|About $25 per parcel
||$350 - $500 per residential property, more for a commercial property
Q. How often does the auditor reappraise?
In Ohio, county auditors are required to do a full, general reappraisal once in every six years. This process is called the Sexennial Reappraisal. The auditor or his qualified appraiser is required to view and appraise every property in the county for this purpose. The process takes between two and two-and-a-half years for a county the size of Franklin to be completed.
On the third year in between reappraisals, each county auditor is required to perform a statistical analysis of the sales which have occurred in the prior three years and provide for a percentage adjustment to be made to the values of all properties in each given marketing neighborhood. These adjustments are also stratified according to value to assure that the equitability of the valuations is maintained or corrected based on the analysis of like comparable sales. This process is called the Triennial Update.
Other than the statutory reappraisal or update, each auditor is charged with annually reviewing the properties which have been found to have changed or are no longer appraised at their fair market value. Most often the change is due to new construction, a change in the physical size or shape of the land, or a demolition or damage to a property.
Q. Why does my tax bill go up?
Franklin County tax rates are dependent on values not only from Franklin County but also values of other counties surrounding us which have overlapping taxing jurisdictions in Franklin County. It is for this reason that the State Department of Taxation must calculate the effective tax rates rather than county auditors.
Generally we apply a rule-of-thumb as follows: If your value changes at the same rate as the average value change in your taxing district, up or down, you will see very little shift in your taxes.
If your tax district experiences an overall decline in residential value and your value declines greater than the average decline in your district you should see a decline in tax. If your decline in value is a lesser percentage than the average decline in your taxing district, you may see a slight increase in your taxes.
If your taxing district experiences an increase in the average residential value and your value increases at approximately the same rate, your taxes will remain similar to last year. If your district increased and your value decreased or went up at a lesser rate than the average, your taxes should decline. If the average value of your district increased and your property value increased at a greater rate, your taxes also will increase.
Of course as always, there are levies which will appear on the primary and general election ballots which if passed will cause an increase in taxes to be paid next year.
Q. What constitutes an improvement?
By definition, an improvement is a building or other structure which is attached to the land. An improvement to the land may also be things such as sidewalks, sewers, street lights, driveways, curbs and gutters. Current improvements on the land may also be improved themselves via replacement, addition or renovation.
Q. My value went down but my tax bill was lowered only marginally. Why?
The purpose of a general reappraisal or triennial update is to assure that each tax payer is paying only their fair share of the tax burden, no more and no less. As a result of a general reappraisal or a triennial update, tax rates are adjusted to collect the same amount of revenue as was collected the year before on all voted millage. Additional revenue may only be raised with the approval of the voters. The only part of the tax rate which is allowed to rise or fall with value is referred to as inside millage and amounts to no more than 10 mills, thus the marginal tax adjustment.
Q. What is equalization?
Equalization is a process whereby the county auditor assures each property is taxed according to its fair market value, no more and no less. Similar properties are to be appraised at similar values. Uniform procedures utilized in the assessment process will generally result in effective equalization. Statistical measures and tests are employed to assure that equity has been achieved and the quality of the appraisal process meets the standards set by the State of Ohio. The statistics developed during the process are designed to uncover biases which if left unaddressed will result in skewed equity. While perfect equalization is not possible, effective equalization can and is achievable in a well-designed appraisal plan.
Q. My neighbor and I have similar homes; however, his has a greater value. Why?
Assuming the properties are in the same taxing district, the same neighborhood and the land and buildings are identical, the difference in value is generally due to variance in amenities and finishes or upgrades. The amenities could be different with the same model home (i.e. decks, recreation rooms, exterior features and other improvements).
Q. What is the Board of Revision? How is it different from the three year or six year Reappraisal?
The Franklin County Board of Revision hears formal complaints on property valuations. Filing a complaint allows property owners to schedule a hearing before the Board of Revision, which is comprised of the County Auditor, Treasurer and a member of the Board of County Commissioners or their representatives. At the hearing, property owners may present information such as recent appraisals or sales data for similar properties in support of their complaints.
By contrast, Board of Revision functions are different than county auditor functions. The Board of Revision sits to determine value initiated by a complaint filing. The Board of Revision determines cases, a case at a time. The three year and six year reappraisal are Auditor functions required by law, such as the mass reappraisal.
The Board of Revision is permitted to use some distressed sales but a county auditor is not permitted under the law to use distressed sales directly in determining property value.
Q. What is an Informal Value Review?
An Informal Value Review is your opportunity as a property owner to sit down with an auditor’s office representative and discuss your documentation supporting a different value from the tentative value determined by the county auditor in a three- or six-year reappraisal before the value becomes final. We hosted 17 Informal Value Reviews during the month of September throughout Franklin County.
Q. What happens during October and November?
The month of October will be used to resolve the question of value for all properties brought to our attention during the Informal Value Review process. Appraisers will perform field inspections to correct data errors, review information provided by the owners and establish final valuations to be used for the tax billing in December.
Franklin County voters likely will be asked to make decisions on levies on Tuesday, Nov. 7, and those may become effective for the December tax bills.
While the election process takes place, the Franklin County Auditor's Office engages in end-of-year processes in which edits are completed and all values are finalized and forwarded to the State Department of Taxation for approval. After the Board of Elections certifies the levy results, our staff compiles all applicable rates and forwards them to the State as well. The tax commissioner then utilizes the value and rate information to calculate the effective tax rates which will be used to calculate the December tax bills.
Values will be finalized between October and November and then sent to the Ohio Department of Taxation for final approval.
Q. When will we find out the results of the Informal Value Review?
Informal Value Review decision letters were sent out on Friday, December 1.
Q. What if I disagree with the findings from the Informal Value Review or was unable to attend an Informal Value Review?
If you disagree with the final value resulting from the Informal Value Review, or if you missed the opportunity to attend a value review session, you have the right to file an application with the Franklin County Board of Revision from the mailing of tax bills in December 2017 through Monday, April 2, 2018.
2017 Reappraisal: Misconceptions v. Realities
The Franklin County Auditor's Office will host five "Question and Answer" sessions this summer to discuss the 2017 Reappraisal.
The following are a series of misconceptions staff has encountered in the past.
Misconception: "Homes are over-appraised for the purpose of generating tax revenue."
Reality: The State of Ohio requires that appraisals be performed every six years (with a triennial update every three years between) to determine that equalization is established. The purpose of a general reappraisal or triennial update is to assure that each tax payer is paying only their fair share of the tax burden, no more and no less. As a result of a general reappraisal or a triennial update, tax rates are adjusted to collect the same amount of revenue as was collected the year before on all voted millage. Additional revenue may only be raised with the approval of the voters. The only part of the tax rate which is allowed to rise or fall with value is referred to as inside millage and amounts to no more than 10 mills.
Misconception: "Foreclosed homes should play a role in the value of my property since they decrease the value of the neighborhood."
Reality: Under Ohio law, county auditors are not permitted to use foreclosure transactions directly in the appraisal process as comparable sales. First and foremost a foreclosure is not a sale; rather it is a judicial process. Second, many foreclosed properties are no longer in comparable condition to other area housing stock. The impact of foreclosures in a neighborhood is measured by the decline in sale prices resulting from arm's length open market sales in which neither party is compelled or forced to buy or sell. Therefore foreclosures are indirectly reflected in the market values established by your county auditor.
Misconception: "My property value varies from the Franklin County Auditor's website and other home value websites."
Reality: Yes, the values generated differ and they should. The purpose of each and the limitations on each are vastly different. The county auditor is required to establish value for tax purposes once every three years for the sole purpose of taxing each property equitably. Further, county auditors in Ohio must use verified sales from the three years prior to the lien date (January 1), for which the values are to be established. The online valuation websites only are as good as the data entered into that application's database and the complexity of the analysis performed by the application. Generally home value websites are designed to indicate a value as of the day you request it and only the property's location and possibly style are considered.
Misconception: "I do not have a say in what my property is worth."
Reality: The 2017 Reappraisal process is designed to include the property owner numerous times throughout the valuation process. In August 2017 a tentative value mailer was sent to every property owner in Franklin County offering the opportunity to meet with an appraiser to offer additional information the owner feels is pertinent. Those Informal Value Reviews will take place throughout the month of September. All property values will be finalized in November for use in the December tax billing. Dissatisfied owners may file an application with the Franklin County Board of Revision. This formal complaint must be filed by April 2, 2018. A hearing will then be held at which time the owner will have the final opportunity to influence the property value. You may be contacted to mediate your Board of Revision case by telephone and avoid the hearing and the lost time and expense associated with the hearing process. Please visit our mediation department for more information.
For more information on your home's value or the home valuation process, please call 614-525-HOME (4663) or email ClarenceMingo@franklincountyohio.gov.