Glossary

The following is a list of terms commonly used by property tax assessors and appraisers. If you have questions about a term or need information on a term not listed, Click Here to contact us.

Accrued Depreciation. The difference between the reproduction cost of the improvements and the market value of the improvements on the same date.

Adjustments. Mathematical changes made to base data to accommodate a comparison.

Agreement of Sale. A written contract of sale between a buyer and a seller, drawn up prior to the actual transfer of title.

Allocation. A method of estimating land value in which sales of improved properties are analyzed to establish a typical ratio of land value to total property value and this ratio is applied to the property being assessed or the comparable sale being analyzed.

Amenity. A tangible or intangible benefit of real property that increases its attractiveness and/or value.

Analysis. The process of providing information, recommendations, and/or conclusions on diversified problems in real estate other than estimating value.
Appeal. A process in which a property owners contests their property tax assessment.

Appraisal. The process of estimating value.

Appraisal Report. The written or oral communication of an appraisal.

Appreciation. An increase in property value.

Assessment. The official valuation of property for ad-valorem taxation purposes.
Assessment sales ratio. The relationship between assessed value and market value.
Assessment roll. A public record that shows property assessments.
Assessment/Sales Ratio. The result derived by dividing the assessed value by the selling price of a particular property used as a measure of the quality of assessment.

Assessor. The person responsible for establishing assessments in a tax jurisdiction.
Assessor's Manual. A manual that lists specific requirements for property assessment; used as a guide.

Certificate of Occupancy. A document issued by the governing authority in accordance with the provisions of a building permit. The certificate of occupancy indicates that in the opinion of the building official, the project has been completed in accordance with the applicable building code.

Class or Grade of Construction. Relates to quality of construction.

Comparables. A shortened term for similar or like property sales, rentals, or operating expenses used for comparison in a valuation process.
Comparative Analysis. The process by which an indicated value is derived using the sales comparison approach.

Cost Approach. A set of procedures through which a value indication is derived for a property by estimating the current cost to construct a reproduction of the existing structure; deducting accrued depreciation, and adding the estimated land value plus an entrepreneurial profit.

Cost Index/Conversion Factor. A multiplier used to convert a known historical cost into an appropriate cost estimate.

Date of Value Estimate. The As-Of date required by the taxing jurisdiction

Depreciation. In appraising, a loss in property value due to all causes.

Effective Age. The age indicated by the condition and utility of a structure.

Equalization. The process by which all properties are assessed equitably at market value or at a ratio as required by law.

Equalized Values. Assessed values after they have been equalized.

Estimate of Value. An opinion based on an analysis of adequate data by one qualified to develop such an opinion.

Fee Simple Estate. Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power, and escheat.

Gross Living Area. The total area of finished, above-grade residential space excluding unheated areas such as porches and balconies; the standard measure for determining the amount of space in residential properties measured from the exterior of the structure.

Improvements. Buildings or other relatively permanent structures or developments located on, or attached to land.

Land Residual Technique. A method of estimating land value in which the net operating income attributable to the land is isolated and capitalized to produce an indication of the land's contribution to the total property value.

Land-to-Building or Improvement Ratio. The proportion of land area to gross building area; typical land-to-building ratios for properties combine land and building components into a functional economic unit.

Land Value Map. An assessment map that shows the value of land by location, expressed as value per square foot, per acre, etc., depending on the type of land involved.

Market Rent. The rental income that a property would most likely command in the open market; indicated by the current rents asked and paid for comparable space as of the date of the appraisal.

Market Value. The most probable price, in cash, or in terms equivalent to cash, or in other precisely revealed terms for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress.

Mass Appraisal. The process of valuing a group of properties as of a given date utilizing standard methodology, employing common data, and allowing for statistical testing.
Reassessment. The process in which all properties within a taxing jurisdiction are revalued to assign new assessed values.

Revaluation. The mass appraisal of all property within an assessment jurisdiction to equalize assessed values.

Sales-Assessment Ratio. A ratio derived by dividing the sale price of a property by its assessed value.

Sales-Ratio Analysis. A study of the relationship between assessed values and sale prices and the deviations that result from differences between the two; used to determine the efficiency and fairness of the assessment process.

Standard Deviation. A measure of the extent of absolute dispersion, variability, or scatter in a frequency distribution.

Statistical Analysis. Quantitative techniques used to identify and measure adjustments to the sale prices of comparable properties; techniques include statistical inference, linear, or multiple regression analysis.

Statistical Inference. The process of reasoning from the specific to the general.
Taxation. The ability of government to raise revenue through assessments.

USPAP. Uniform Standards of Professional Appraisal Practice. Current standards of the appraisal profession, developed for appraisers and the users of appraisal services by the Appraisal Standards Board of The Appraisal Foundation. The Uniform Standards set forth the procedures to be followed in developing an appraisal, analysis, or opinion and the manner in which an appraisal, analysis, or opinion is communicated. They are endorsed by professional appraisal organizations.