General Information
How is real property assessed?
Real property is assessed at the fair market value. The fair market value of a property is the
amount that a willing seller would accept and a willing buyer would pay in an open market
within a reasonable market time period.
Appraisal Methods
There are three standard methods for estimating the fair market value:
1.
Market Approach
The subject property is compared to sold properties with similar characteristics using
sales in which both buyer and seller acted without undue pressure. This method is
normally used to value residential, vacant, and farm properties.
2.
Cost Approach
Using today’s labor and material prices, the cost to replace the structure with a similar
one is calculated. If the structure is not new, the assessor determines how much it has
depreciated since it was built. The resulting value is added to an estimate of the
market value of the land. This method is used to value new improvements, special
purpose and utility properties.
3.
Income Approach
The value of the property is determined based on an analysis of how much income a
property, like an apartment building, store, or factory, will produce if rented.
Operating expenses, insurance, maintenance costs, financing terms, and how much
money owners expect to make on this type of property are considered.
200 Main Street, 2nd Floor - Courthouse
Williamsburg, KY 40769
Phone: (606) 549-6008, 549-6009
Fax: (606) 549-6042
pva@whitleypva.com