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Why Multifamily Property Valuations Are Often Over Assessed
For multifamily property owners, property taxes represent a major operating expense, which if over assessed can decrease the value of your property. The amount on your property tax bill is based upon assessed property values. In theory, these assessments should reflect the property’s fair market value. However, that’s not always the case as property appraisers may be mistaken in their assumptions and methodologies. Our services can help you to ensure that your property tax bill is fair and equitable.
How Assessments Can Be Inaccurate
Many local jurisdictions use mass appraisal methods designed for efficiency, not precision. These assessments often:
- Overlook specific property conditions such as deferred maintenance or recent rent changes
- Rely on outdated or incomplete sales and income data
- Fail to adjust downward automatically when market conditions decline
As a result, owners may pay taxes based on inflated valuations that don’t match current economic realities. For income-generating properties like apartments, even small discrepancies in valuation can result in significantly inflated tax bills year after year.
Challenges in Managing Assessments
Property tax appeals are always an option, but they can be complex to navigate without an experienced consultant. Each jurisdiction has its own rules, deadlines, and documentation requirements, which can be difficult to track and manage, especially for owners with properties in multiple jurisdictions. Missing an appeal window or lacking adequate documentation often means overassessments go unchallenged.
Financial Impact of Overpayment
By overpaying property taxes, the property’s net operating income is decreased, thus lowering the overall property value. When owners spend more on their taxes than they should, this allows for less cash flow that could be used for reinvestments or improvements to their property. Even small overassessments can lead to significant cumulative costs over time, especially if this mistake is never corrected through a successful appeal.
Key Factors Leading to Overpayment
- Mass appraisal techniques that ignore property-specific details
- Use of outdated market or income data
- Infrequent or absent downward reassessments
- Complex and varied appeal processes
Regularly reviewing property tax assessments can help multifamily owners identify discrepancies and ensure they are not paying more than necessary. This vigilance is an important part of effective asset management. Hiring a property tax consultant is an easy, efficient method of doing so. Allowing an experienced professional to take charge of ensuring that a property owner never pays above a fair and equitable amount of property taxes.
FirstPointe Can Offer More
At FirstPointe Advisors, our team of experts work with our clients to prevent unnecessarily high property tax bills. Filing and managing appeals can be a tedious task, so as a firm we keep our clients informed while we handle the process. We offer a variety of additional property tax services to help increase your bottom line, including property tax forecasting, litigation support, and more.
Don’t let one of your biggest expenses become a little bigger.
Contact us for today for help on your property tax needs!
954.546.9630
6301 NW 5th Way
Suite 2800
Fort Lauderdale,
FL 33309
