Verifying sales data is an important step in valuation
Our work entails setting the market value for each property, and for our appraisal departments, that often means looking at comparable sales data.
Our Commercial Appraisal Department Manager, Luke Mittner, explains, “Our office uses a mass appraisal model that is calibrated using information from comparable property sales.” Property sales data is an important resource that indicates the state of Palm Beach County’s real estate market.
Because property sales information creates a foundation for some valuation processes, our office verifies that the details of each sale reflects the market before we use the information of any particular sale. “Only sales that meet the definition of market value are used by our office to develop estimates of market value for similar properties,” notes Steve Eagen, Director of Valuation.
To verify sales information, our appraisers regularly call and mail letters to the market participants (sellers, buyers, brokers, attorneys, etc.) involved with real estate sales. We try to obtain details regarding property sales from someone directly involved with each transaction. We then use this data to determine which sales represent market value and will be used in the development of property appraisals.
The sales verification process helps us:
- Confirm the sale price: While sale prices are often available in public records, appraisers may want to confirm that the listed price accurately reflects what was actually paid.
- Understand the nature of the sale: Not all sales reflect market value. Transactions between family members, auctions, or those with unusual financing terms might not be typical of the market. Appraisers will ask about a sale’s context to decide if it should be included in their analysis.
- Identify property features: Our office may ask about specific features of the property, such as recent renovations, the condition at the time of sale, or any factors that might have influenced the price. This helps refine property assessments and ensure they are accurate.
The information provided in the sales verification process is only used for assessment purposes. Property owners are not required to answer all questions, but providing accurate details can help ensure a fair and accurate assessment of the sold property and other comparable properties.
“The more accurate the property data is, the fairer the tax assessments are likely to be,” adds Cecil Jackson, Chief Appraiser. “Sales verification will only affect taxes by ensuring that they are as fair as possible.”
Sales verification is an important part of maintaining fair and equitable property assessments. Answering our questions about property sales gives our office reliable data from which we can then create appraisals that are fair, equitable, and reflect the market.