HOW
TO ESTIMATE A PROPERTY MARKET VALUE
THROUGH SALES AND TAX ASSESSMENT
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Sample: “Taxes divided by Mil Rate to reach
municipal assessed value”
SW Harbor 10.00

Based on a
Mil rate:
.010 ($10 per thousand)
Taxes: 1000
1000 divided
by .010 = Assessed value: 100,000


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Samples:
“Assessed value to sold price ratio”
Each
town has a different mil rate. The mil
rate is based on the town's budget.
Find out the mil rate of
the town.
All sales have to be within the town.
Find 5 or more sales then perform the
following:

Property sold
for: 125,000
Assessed
Value:
100,000
100,000
divided by 125,000 = 0.80%

Property sold
for: 250,000
Assessed
Value:
225,000
225,000
divided
by 250,000 = 0.90% Borderline



Property sold
for: 700,000
Assessed Value: 525,000
525,000
divided
by 700,000 =
0.75%

Property
sold
for: 399,000
Assessed
Value:
380,000
380,000
divided
by 399,000 = 0.95%
Extreme (no good) 


Property sold for: 410,000
Assessed
Value:
225,000
225,000
divided
by 410,000 = 0.54%
Extreme (no good) 
Property sold
for: 275,000
Assessed
Value:
225,000
225,000
divided
by 275,000 = 0.81%


Out
of the 6 sales, 2 were extreme (54
& 95) and the (90)
was borderline.
3 sales: The sum of 80 +75 + 81 divided by 3
gives a mean average of 78.6 ratio.
Result: A house assessed at 300,000 divided
by .786 = 381,679 say $381,500
estimated market value
4
sales: The sum of 80 + 75 + 81 + 90 divided by 4 would give
you a mean average of 81.5 ratio.
Result: A house assessed 300,000 divided
by .815 = 368,098 say $368,000 estimated
market value


FOOTNOTE:
Dividing the total of 6 ratios,
54 + 80 + 75 +
81 + 90 + 95 = 475 / 6 = 79.1 ratio.
300,000 divided by .791 =
379,266. This indicates the town mil
rate at about 79% of value.
Each town has a
different mil rate. The mil rate is
based on the town's budget.
Although state law requires every town to be
as close to 100% as possible, very few are.
Therefore the assessment value compared to
sold price is a good solid way to determine
market value within a municipality.


