Florida Assessment Two Step

Why do some assessors suggest the method affects the application of costs of sale?

Even if there is no contract price, and probably 2/3's of real property does not sell during a run up to a specific assessment date, the fundamentals remain the same.

Florida is a value in exchange state. That means a transaction is assumed, and the basic question is What would a buyer pay for that property?

How does a buyer decide on a price? One of the three methods of appraisal might be the best case, but suppose the buyer plucks a number from the air? Does it matter how the number is selected, as long as the seller agrees to it, and there is a meeting of the minds? Most transactions include some pluck a number influences. More commonly, it's the unsold property that leads to use of methods.

We think the nature of the method to reach a price is only the first step. To meet the mandate in section 194.301 (Presumption Statute), the second step must be applied.

What is the second step? It's to consider properly the criteria in section 193.011 (8 criteria).

Why would the 1st and 8th criteria be applicable to the market approach but not to the cost or income approach?

When taxpayers are assessed differently for similar property in the same classification, is that constitutional?

How can assessments of similar property be constitutional if the criteria are not applied in a uniform manner?

We have not heard a credible reason for suggesting the costs of sale are not applicable using the cost or income methods - because those methods merely identify the potential contract price of an unsold property. So, you have a transaction. It's at arms length.

However the price is reached, to get to a lawful assessment value, the 8 criteria must be applied.

Do you want to lower your property taxes? Ad valorem taxes are based upon valuation methods, modified by state laws and regulations. CPS knows due process procedures and value applications should be applied to your real and tangible taxes. If you have a question, or need professional services, for a free consultation, contact CPS at 1-305-372-9200 or email us at cps1@flash.net.