State Specific Question About: IOWA (IA)

Keith -- this happens all the time. Basically, know what you paid is often NOT considered fair market value. They will simply say that you were able to buy below market (instead of admitting that the market has been lowered -- in which case, they'd have no argument against 100s of other appeals that would immediately be filed by everyone else in the area).

So, yes, it seems logical that what you paid in a normal sale should be the "fair market value" of a property -- but, all the time, it just doesn't work as simply as that.

- John...

Ignore that extra "know" in the second sentence. Should have just been:

"Basically, what you paid is often NOT considered fair market value."

Also, all that being said, it doesn't mean that you shouldn't appeal again -- but when you go an appeal, you'll need to go armed with more than just the price you paid. You'll want to bring comps and such for OTHER properties sold recently that are also below the current assessed value.

- John...

I fought 2 property tax assessments this year. Won 1, lost 1. Where I am, the property is assessed based on the value as of Jan. 1 of the tax year (here, it's tax year 2008). Even though a property just like mine sold for 50k less in November of '08, the prices hadn't fallen as of January '08, so I am still assessed at the higher value.

Another thing they will try to do is have the property listed as "distressed". If they can call it distressed, then your purchase price is out the window. Foreclosure is most common type if distress, but lawsuits, deaths, divorce, anything that would cause the sell to be less than market.