The Assessor’s Office is responsible for estimating the market value and determining the classification of all real estate property in the City for property tax purposes.
Market value is defined as the price that could be obtained at a private sale or an auction sale, if the assessor determines the price from an auction sale represents an arms-length transaction. The price obtained at a forced sale shall not be considered. In other words: Market value is the price that would prevail under competitive open-market conditions.
Assessors view the property and verify or gather new information.
Value and classification of all real estate properties must be established on January 2nd each year. The City of Minneapolis Assessor’s Office works throughout the year to estimate the market value of each property for the following January 2nd assessment. The Assessor’s Office applies one or more of the three approaches to value in determining a properties market value. The three approaches are: Sales Comparison Approach, Cost Approach and Income Approach. While all three approaches are considered, one approach may be better suited than the others for estimating value of a particular property. The most commonly used approached for residential property in Minneapolis is the Sales Comparison Approach.
Assessors compute the value.
In this approach the appraiser gathers information on all characteristics of the property that affect market value, such as size, age, quality, basement finish, etc. The property characteristics are then entered into a computerized appraisal system. The computerized appraisal program compares each properties attributes to actual sales of similar properties in the area to determine the market value of the property.
Each year the assessor analyzes actual sales of property in each community. Information on actual sales is updated to reflect market trends, and the property’s value is calculated. The market value estimated by the appraiser in this way should be very close to the amount the property would sell for, if placed on the open market. The State Board of Equalization requires the overall level of assessment to be between 90-105% of market value.
- All property is revalued each year as of January 2.
- The estimate of market value represents a theoretical selling price for your property.
- If you believe that your property would not sell for the amount shown on your Market Value Notification or Truth in Taxation statements; you may contact the City of Minneapolis Assessor’s Office to discuss your concerns.
The Assessor's office wants to value all property in a uniform and equitable manner. The real estate market for residential property in Minneapolis has been flat in some areas and is declining in others. We have developed procedures for field appraisals to be as consistent as possible among our appraisal staff in evaluating subjective characteristics such as condition. However, it is recognized that appraisal or mass appraisal will always involve an appraiser's judgment.
- The components that make up the market value are developed from replacement cost schedules, abstraction from sales data and other sources.
- In general, the land typically accounts for 20-25% of total property value (lakeshore or other property with a location amenity will exceed that percentage).
- Quantitative factors are items such as the square footage of the property, number of bathrooms or other features. The majority of the value is the basic square footage of the home.
- Qualitative variables are more subjective in nature. They include the location or condition of the property
- The basic valuation model for a residential property is: (Square Feet of AREA) ($ per S.F. per Mass Appraisal Schedule) = Base Value plus additional features on a flat cost basis less all forms of depreciation plus site value equals market value.
Last updated Nov 21, 2013