Base Year

Many taxpayers assume that their home’s assessed value should match its current market value.  However, this is rarely the case.  Instead, the county assessment office determines assessed values as of a “base year.”

Rather than a home’s assessed value matching its current market value, a properly assessed home should match its market value as of the base year.  For instance, consider a home worth $250,000 in the year 2018.   The county assesses the property at $200,000 with a base year of 2000.  Assuming that home values increased by 25% between 2000 and 2018, this would be a properly assessed parcel.

Common Level Ratio

So how do we know how much home values have increased since the base year?  The State Tax Equalization Board (STEB) uses recent sale data to determine the average change in home values for a county since its base year.  The Common Level Ratio (CLR) represents this change in average values.

Annually, STEB publishes a list of CLR’s for every county in the commonwealth.  In the above example, if the county’s average home values had in fact increased by 25%, then its CLR would be 1.25.

To convert an assessed value to an approximate current market value, one would multiply the assessed value by the CLR.  Continuing with our example, the equation would be:

    \begin{align*} [Assessed Value] \times [CLR] &= [Current Market Value] \\ \$200,000 \times 1.25 &= \$250,000 \end{align*}

In most cases, the base year matches the year of the last countywide reassessment.

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