How is real property assessed?


The municipal assessor is responsible to maintain assessment at a uniform percentage of market value. 

There are (3) three methodologies utilized in order to derive an assessed value.  These methodologies are known as the Cost Approach, Market (aka Sales) Approach and the Income Approach.  These approaches are industry standards for the valuation of all real property. 

            Valuations are established on a parcel by parcel basis for non-reassessment municipalities utilizing the methodologies above. For municipalities who are recognized as reassessment jurisdictions, these methodologies are applied on a Mass Appraisal basis through the derivation of statistical models, again utilizing the above noted methodologies.

Mass appraisal is the systematic appraisal of groups of properties as of a given date using standardized procedures and statistical testing. This differs from single-property appraisal, commonly referred to as "fee" or "bank" appraisal, which normally deals with only a particular property as of a given date.

As of 2017, the Town of Carmel is recognized as a reassessment jurisdiction according to New York State Office of Real Property Tax Services.  In 2017, statistical models were built by the Town’s Reassessment Contractor in conjunction with State Representatives, the Town’s Assessor and agreed upon and recommended to be implemented by the Reassessment Monitor.  In 2018 and going forward, all properties within the boundaries of the Town, will be assessed and reassessed to maintain values equal to 100% of market value.  Simply, if you review your assessment, or review someone else’s assessment, the value should be equal to what the property would sell for in the open market.

            This will be completed by utilizing any one, or all three approaches to value built into a model to value all similar properties similarly. This is known as Mass Appraisal

            Typically, for residential properties, comparable sales approach is utilized.  The Sales Comparison Approach involves the comparison of similar property that have recently sold or are currently offered for sale, with the subject property. These properties are compared to the subject with regard to differences or similarities influencing the sale in property rights conveyed, financing, conditions of sale, time, condition of the improvements, size, location and other physical characteristics.  The differences in the comparable property are then adjusted to the subject property to indicate a value range for the property being appraised.  From this range, a final value conclusion is made.

            Commercial properties are typically valued utilizing the Rental Income Approach to Value.  The Income Capitalization Approach is a process in which a value indication is derived by estimating the present worth of future income through a capitalization process.  In order to utilize this approach, an estimate of potential gross rental income is made via a comparison with similar properties.  Reasonable expenses derived from typical or market experiences are then subtracted in order to arrive at a projected stabilized net income.  The resultant net income is capitalized with an overall rate that has been extracted from data derived in the market into a value conclusion.

            The Cost Approach is a calculation based on the cost to construct, minus depreciation plus land values.  This method is best utilized for newly built properties and specialty properties as age and condition of improvements sometimes make the estimate of depreciation purely speculative.  In addition, due to the scarcity of available land for development, there have been few sales of vacant land in recent years. Therefore, this approach is not typically used in the valuation process.