Measuring the Quality of Reappraisal Eric Dale Montana Department - PowerPoint PPT Presentation

December 3, 2015 Measuring the Quality of Reappraisal Eric Dale Montana Department of Revenue Tax Policy and Research 406-444-7925 edale@mt.gov 1 1

December 3, 2015 Background Actual Sales 2 2

December 3, 2015 Background Property Attributes Sales Price Relationships 3 3

December 3, 2015 Background Property Attributes Est. Value Relationships 4 4

December 3, 2015 Background Quality Check Ratio = 𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵 𝑊𝐵𝑊𝑊𝐵 𝑇𝐵𝑊𝐵𝐵 𝑄𝐵𝐵𝑄𝐵 5 5

December 3, 2015 Background Quality Check Centered Around 100% 6 6

December 3, 2015 Background Quality Check Minimal Variation 7 7

Reappraisal Experience in the 2015 # in Bracket 100 200 300 400 500 600 700 0 0.00-0.49 0.51-0.53 0.55-0.57 0.59-0.61 0.63-0.65 0.67-0.69 0.71-0.73 0.75-0.77 0.79-0.81 Sales Ratio Frequency Distribution 0.83-0.85 0.87-0.89 0.91-0.93 Ratio=1 0.95-0.97 0.99-1.01 1.03-1.05 1.07-1.09 1.11-1.13 1.15-1.17 1.19-1.21 1.23-1.25 1.27-1.29 1.31-1.33 Range of Bracket 1.35-1.37 1.39-1.41 1.43-1.45 1.47-1.49 1.51-1.53 1.55-1.57 1.59-1.61 1.63-1.65 1.67-1.69 1.71-1.73 1.75-1.77 1.79-1.81 1.83-1.85 1.87-1.89 2008 Sales Ratios 2014 Sales Ratios 1.91-1.93 1.95-1.97 1.99-2.01 2.03-2.05 2.07-2.09 2.11-2.13 2.15-2.17 2.19-2.21 2.23-2.25 2.27-2.29 2.31-2.33 2.35-2.37 2.39-2.41 2.43-2.45 2.47-2.49 2.51+ 8 8 December 3, 2015

December 3, 2015 Experience in the 2015 Reappraisal $500,000 Least Squares $450,000 $400,000 one to one Sales Price $350,000 $300,000 Sales Price $250,000 $200,000 $150,000 $100,000 $50,000 $0 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 9 9 2008 Reappraisal Value 2008 Reappraisal Value

December 3, 2015 Experience in the 2015 Reappraisal $500,000 Least Squares $450,000 $400,000 one to one Sales Price $350,000 $300,000 Sales Price $250,000 $200,000 $150,000 $100,000 $50,000 $0 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 10 10 2014 Reappraisal Value 2014 Reappraisal Value

December 3, 2015 NE NW SW SE 11 11

# in Bracket # in Bracket 100 120 140 160 180 100 120 140 160 20 40 60 80 20 40 60 80 0 0 0.00-0.49 0.00-0.49 0.57-0.59 0.57-0.59 0.67-0.69 0.67-0.69 0.77-0.79 0.77-0.79 North West South West 0.87-0.89 0.87-0.89 Ratio=1 Ratio=1 0.97-0.99 0.97-0.99 1.07-1.09 1.07-1.09 Region 3 Region 1 1.17-1.19 1.17-1.19 1.27-1.29 1.27-1.29 Range of Bracket Range of Bracket 1.37-1.39 1.37-1.39 1.47-1.49 1.47-1.49 1.57-1.59 1.57-1.59 1.67-1.69 1.67-1.69 1.77-1.79 1.77-1.79 2008 Sales Ratios 2014 Sales Ratios 2008 Sales Ratios 2014 Sales Ratios 1.87-1.89 1.87-1.89 1.97-1.99 1.97-1.99 2.07-2.09 2.07-2.09 2.17-2.19 2.17-2.19 2.27-2.29 2.27-2.29 2.37-2.39 2.37-2.39 2.47-2.49 2.47-2.49 # in Bracket # in Bracket 100 150 200 250 300 100 50 10 20 30 40 50 60 70 80 90 0 0 0.00-0.49 0.00-0.49 0.57-0.59 0.57-0.59 0.67-0.69 0.67-0.69 0.77-0.79 0.77-0.79 South East 0.87-0.89 0.87-0.89 Ratio=1 Ratio=1 North East 0.97-0.99 0.97-0.99 1.07-1.09 1.07-1.09 Region 4 Region 2 1.17-1.19 1.17-1.19 1.27-1.29 Range of Bracket 1.27-1.29 Range of Bracket 1.37-1.39 1.37-1.39 1.47-1.49 1.47-1.49 1.57-1.59 1.57-1.59 1.67-1.69 1.67-1.69 1.77-1.79 1.77-1.79 2008 Sales Ratios 2014 Sales Ratios 2008 Sales Ratios 2014 Sales Ratios 1.87-1.89 1.87-1.89 1.97-1.99 1.97-1.99 2.07-2.09 2.07-2.09 2.17-2.19 2.17-2.19 2.27-2.29 2.27-2.29 2.37-2.39 2.37-2.39 2.47-2.49 2.47-2.49 12 12 December 3, 2015

December 3, 2015 Commercial Properties 13 13

Commercial Properties # in Bracket 10 20 30 40 50 60 70 0 0.00-0.49 0.51-0.53 0.55-0.57 0.59-0.61 0.63-0.65 0.67-0.69 0.71-0.73 0.75-0.77 0.79-0.81 0.83-0.85 Sales Ratio Frequency Distribution 0.87-0.89 0.91-0.93 Ratio=1 0.95-0.97 0.99-1.01 1.03-1.05 1.07-1.09 1.11-1.13 1.15-1.17 1.19-1.21 1.23-1.25 1.27-1.29 1.31-1.33 Range of Bracket 1.35-1.37 1.39-1.41 1.43-1.45 1.47-1.49 1.51-1.53 1.55-1.57 1.59-1.61 1.63-1.65 1.67-1.69 1.71-1.73 1.75-1.77 1.79-1.81 1.83-1.85 1.87-1.89 2008 Sales Ratios 2014 Sales Ratios 1.91-1.93 1.95-1.97 1.99-2.01 2.03-2.05 2.07-2.09 2.11-2.13 2.15-2.17 2.19-2.21 2.23-2.25 2.27-2.29 2.31-2.33 2.35-2.37 2.39-2.41 2.43-2.45 2.47-2.49 2.51+ 14 14 December 3, 2015

December 3, 2015 Commercial Properties $500,000 Least Squares $450,000 $400,000 one to one Sales Price $350,000 $300,000 Sales Price $250,000 $200,000 $150,000 $100,000 $50,000 $0 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 2008 Reappraisal Value 2008 Reappraisal Value 15 15

December 3, 2015 Commercial Properties $500,000 Least Squares $450,000 $400,000 one to one Sales Price $350,000 $300,000 Sales Price $250,000 $200,000 $150,000 $100,000 $50,000 $0 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 2014 Reappraisal Value 2014 Reappraisal Value 16 16

December 3, 2015 NE NW SW SE 17 17

Region 1 Sales Ratio Statistics Region 2 Sales Ratio Statistics North West North East December 3, 2015 New vs. Old New vs. Old New Old New Old Measures of Appraisal Level Measures of Appraisal Level Upper Bound 100.67% 117.04% Upper Bound 106.29% 94.77% Median Assessment Ratio 98.67% 113.31% Median Assessment Ratio 103.71% 86.86% Lower Bound 96.67% 106.61% Lower Bound 101.58% 81.33% Upper Bound 103.07% 119.15% Upper Bound 110.00% 97.24% Mean Assessment Ratio 100.42% 113.97% Mean Assessment Ratio 106.14% 91.43% Lower Bound 97.77% 108.79% Lower Bound 102.28% 85.61% Upper Bound 99.74% 109.12% Upper Bound 103.45% 84.34% Weighted Mean Assessment Ratio 94.34% 102.58% Weighted Mean Assessment Ratio 98.89% 78.69% Lower Bound 88.95% 96.04% Lower Bound 94.32% 73.05% Measure of Appraisal Uniformity Measure of Appraisal Uniformity Coefficient of Dispersion 12.0767 23.7408 Coefficient of Dispersion 15.9892 30.7389 Standard Deviation 0.1749 0.3511 Standard Deviation 0.2260 0.3629 Price Related Differential 1.0644 1.1110 Price Related Differential 1.0734 1.1619 Region 3 Sales Ratio Statistics Region 4 Sales Ratio Statistics South West South East New vs. Old New vs. Old New Old New Old Measures of Appraisal Level Measures of Appraisal Level Upper Bound 99.09% 79.49% Upper Bound 98.26% 103.09% Median Assessment Ratio 96.22% 75.89% Median Assessment Ratio 95.97% 99.79% Lower Bound 93.71% 71.84% Lower Bound 94.96% 96.50% Upper Bound 98.43% 83.34% Upper Bound 101.07% 107.55% Mean Assessment Ratio 95.90% 79.73% Mean Assessment Ratio 99.16% 104.15% Lower Bound 93.38% 76.12% Lower Bound 97.26% 100.74% Upper Bound 97.09% 82.40% Upper Bound 98.99% 98.64% Weighted Mean Assessment Ratio 93.10% 77.03% Weighted Mean Assessment Ratio 95.99% 95.81% Lower Bound 89.11% 71.65% Lower Bound 92.99% 92.99% Measure of Appraisal Uniformity Measure of Appraisal Uniformity Coefficient of Dispersion 15.8455 28.4273 Coefficient of Dispersion 14.9517 25.8180 Standard Deviation 0.1960 0.2892 Standard Deviation 0.1927 0.3546 18 18 Price Related Differential 1.0301 1.0352 Price Related Differential 1.0331 1.0870

December 3, 2015 Appraisal Method Income Vs Cost 19 19

December 3, 2015 Questions 20 20