Why Values Change

    Wisconsin is referred to as a "market value" state meaning that property assessments throughout Wisconsin use, as their basis, sales of property transacted in the real estate market. Buyers of real estate determine market value as they purchase a specific property for a specific price. The components of any property that create value are many including location, size, quality, physical condition, and amenities offered. Overall though, market value can be considered a measure of a property's desirability. The more desirable a property becomes, the greater the consideration or price that will be offered. For instance, if a home is made larger by the addition of a new family room and additional bathroom, its desirability is enhanced by offering more to prospective buyers who are willing to pay more for a home with a new family room and an additional bathroom. Since buyers are now willing to pay more for the added family room and bath, the market value has increased and so does the assessed value because, in Wisconsin, the assessed value is meant to reflect market value.

    Similarly, should the desirability of a property be reduced because of a fire or removal of a garage, the assessed value would also decrease to reflect the effect the fire damage or garage removal has on the market value of the property.

    For any number of reasons, a neighborhood or a particular house style may become more desirable thus causing market values to rise at rates higher than other neighborhoods or house styles. The assessor's office must constantly stay alert to spot these trends so they are included in the sales analysis phase of the valuation process.

    Inflation and the economy of the entire community also affect your assessed value. As building material, labor and the cost of money increases the cost of new construction, the prices paid for existing housing stock also increases.

    The assessor's office does not create value -- people determine value by comparison shopping and deciding what to pay for real estate in the market place. It is the assessor's office responsibility to adjust existing assessments to keep pace with the changing real estate market.

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