A reassessment is a process of taking a second look at the value of an asset or investment. The term is most commonly associated with the redetermination of the value of real estate holdings, and is likely to occur on at least an annual basis. Reassessements also take place with other types of assets, including investments where there is some fluctuation in the value of stocks and other types of securities.
As related to land values, a reassessment is usually a formal process that is conducted by professional appraisers. Most municipalities require that this type of activity is conducted on an annual basis, usually just before property taxes are assessed on any land holdings that are contained within the city limits. It is important to note that landholders usually have the right to dispute the findings of the appraisal if they believe that the reassessment did not yield an accurate outcome. This is because inaccuracies in the appraisal process can sometimes lead to property taxes that are higher than the land owner believes are fair and just.
There are several factors that go into the reassessment of property values. The condition and quality of the property itself serves as the basis for the evaluation. An appraiser will also take into consideration the assessed value of the properties in the immediate vicinity of the property undergoing the reassessment. General market conditions in the area will also play a role in the outcome of the appraisal. This means that even if a given property is in good condition, the value may be driven down by substandard properties that are close by, or by economic conditions that have led to a depreciation of all property in the immediate area.
For real estate and other investments, reassessment also serves an important function in helping to determine the market value of the asset. Homeowners who wish to sell their property will often refer to the most recently assessed value of the home, and compare that to the equity they have in the property, while also looking closely at what similar homes in the area are selling for in the current market. Depending on the relationship between these factors, and projections of where the market will go in the coming months or years, the homeowner may either attempt to expedite the sale to avoid further depreciation, or hold off on the sale if the market is anticipated to improve within a reasonable period of time.
