Costs
Assessed Value
The dollar value assigned to a property by a local tax assessor for the purpose of calculating property taxes. Assessed value is often lower than market value and is determined by the county or municipality. Your annual property tax bill is calculated by multiplying the assessed value by the local tax rate. You can usually appeal your assessment if you believe it is too high.
Why It Matters
Assessed Value is one of the expenses that can catch homebuyers off guard if they don't budget for it early. Total homebuying costs go beyond the purchase price — closing costs, prepaid items, and ongoing expenses like assessed value can add thousands to your out-of-pocket costs.
The cost of assessed value varies depending on your location, loan type, and specific transaction. Shopping around and negotiating can often reduce these costs significantly. Always ask for a detailed line-item breakdown from your lender or service provider.
Real-World Example
On a $350,000 home purchase, assessed value could range from a few hundred to several thousand dollars depending on your state and lender. Get at least 3 quotes to ensure you're paying a competitive rate for this service.
Pro Tip
Don't assume all costs are non-negotiable. Many fees related to assessed value can be reduced by shopping service providers independently rather than using your lender's default recommendations.