Home Values & Pricing

What is the difference between market value, assessed value, and tax value?

By Steve Lockhart

The short answer

Every year a homeowner opens the county postal the tax bill, sees a number, and asks if that is what the home is worth. It is not.

Full answer

Every year a homeowner opens the county postal the tax bill, sees a number, and asks if that is what the home is worth. It is not. The county figure answers a tax question, and it can sit well above or below what a buyer would pay.

Market value is the number that matters in real life: what a well-informed, willing buyer would pay, and a reasonable seller would accept, in the open market today. It is built from the most recent comparable sales, and it moves with the market, because it is the number you will quote on price when selling, refinancing, or measuring equity.

The assessed value is the county's number for property tax. In Nevada, the assessor determines a value for each property and then applies a statutory assessment ratio, so the assessed figure on your notice is a reduced percentage of the base, by design. The ratio makes the tax bill consistent across properties, and it is not aiming at sale price at all.

Tax value is often used loosely for the assessor's estimated of taxable value, the base the assessment is calculated from. Fine terminology changes faster than the tax law, but the principle survives: the entire assessment machine exists to raise revenue, and it updates on the county's schedule, meaning it trails the market, high or low.

Yet the assessed number is not useless. It is the anchor of your property tax bill, and if the county has it, wrong: this detail of your property or the wrong comparable, a challenge to the assessment is a legitimate legal step that can lower your tax. That is separate from knowing your market value.

For pricing, a sale, a refi, or net proceeds, the county number is not your number. Build from a CMA, sit next to my listings, and let the market correct if you must. The difference between the value and the county tells you nothing about what a buyer will pay: the market does, and only it does.

Go a little deeper

Frequently asked

Questions homeowners often follow up on

Why is my assessed value so much lower than market?

In Nevada the assessed value is a statutory fraction or percentage of the taxable value, not a market estimate, so the notice is designed to be a portion of a sale price. That keeps the tax formula consistent. A lower assessed figure is normal, and it says nothing about what you would sell for.

Should I appeal my assessed value?

Only if you believe the county's facts are wrong, for example a size error, a wrong property description, or a comparable that does not apply. The appeal is about taxes. For market value, a CMA built on sales is the right tool, not a tax challenge.

Which number do I use for my net proceeds?

Market value, always. A net sheet is about cash you would receive, and that comes from what buyers pay, not what a county computes. You will see the whole gap in any net sheet, so keep the tax line and the market line separate for your planning.

The Lockhart Method

Your Home | My Strategy | Proven Results

My strategy: keep the county in its own lane and plan on the market. I put the assessed line and the market line side by side for you, explain how Nevada carries to each, and only use the market numbers for selling, borrowing, and equity. A piece of paper about taxes never makes your asking price.

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