From Floor to Ceiling

Last year, 90% of you were in the top 10% of your class.  Today, 90% of you are in the bottom 90% of your class.

–Stanford Dean of Admissions Fred Hargadon, to each incoming class at freshmen orientation

Five years ago, if a home’s tax assessed value was relevant at all in establishing fair market value, it served as a floor.


At least in the Twin Cities, tax assessed value frequently serves as the ceiling.

And for homes that need significant updating and/or have been off the market for decades, the tax assessed value can be little more than wishful thinking.

Growing Gap

That’s because, year after year, the taxman presumes that a given home is keeping up with its peers.

If instead the home is standing still — or worse, accumulating deferred maintenance — the gap between fair market value and tax assessed value can be sizable.

P.S.:  Why don’t more homeowners challenge their tax assessed value? 

Especially the last couple years, they do.

But I suspect that for at least some older homeowners, seeing their tax assessed value climb year after year (at least until recently), is a badge of pride and honor — albeit an expensive one.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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