Real Estate Assessments
The assessors completed the biennial reassessment of City of Martinsville real properties in late December 2016. Reassessment notices were mailed to property owners January 6, 2017. The assessors were available to discuss the assessments during the review period, which had been set for January 17 through February 28, 2017. Any taxpayer who felt his property was assessed in excess of its fair market value or had not been uniformly or equitably assessed in relation to other similar properties had the opportunity to appeal the assessment during the review period with the assessors or to file an appeal application with the Board of Equalization by April 3, 2017. The property owner or his agent had to prove that the property was assessed in excess of its fair market value.
Appeal applications are available in the City Assessor's office, the Commissioner of the Revenue office, or may be downloaded:
All applications were finally discharged by the Board of Equalization by May 15, 2017 pursuant to city ordinance.
Purpose of the Reassessment
The purpose of an assessment is to equally distribute the burden of taxation evenly within the locality. The foremost concern of the assessor is uniformity. This does not mean that all property is assessed at the same value, but that properties of equal value have equal assessments.
The assessors do not create the value of property. People buying and selling real estate in the open market establish the value of property. The assessor analyzes the sales, as well as replacement costs, income that a property may generate, property depreciation and location in order to arrive at a "fair market value" of the property.
Real property within the City of Martinsville is reassessed every two years. The assessor begins the process by establishing the rate tables that he will work with to equally and uniformly assess each property. The rate tables are created based on what it would cost to replace the property new. Once the tables are established the site visits begin. The assessor applies the rates to the property he is viewing. Age and condition of the building and location affect whether adjustments need to be made in order to arrive at an assessment of the market value.
The reassessment to be completed December 31, 2016 used sales data for comparison purposes from January 1, 2013 through December 31, 2016. Property was assessed based on its value on January 1, 2017. The 2017 Reassessment becomes effective July 1, 2017 and remains in effect until June 30, 2019.
Fair Market Value
Fair market value is the amount a typical, well-informed purchaser would be willing to pay for a property. The seller and buyer must be unrelated, the seller must be willing, and under no pressure to sell, and the buyer must be willing, and under no obligation to buy. The property must be on the market for a reasonable length of time, the payment must be in cash or its equivalent, and the financing must be typical for that type of property. If all of these conditions are present, a market value, arm's-length sale exists.
Determining fair market value involves many factors:
- Determining highest and best use of the property
- Replacement cost less depreciation of the property
- Recent sales of similar properties
- Income generated by the property
The final assessment figure is a correlation of these factors giving the most weight to the approach that is most appropriate for the property being assessed.
Localities are required to assess property at 100% of its fair market value; however, since a reassessment is not done annually in the City of Martinsville (or many other localities), this is rarely achieved. The ratio of assessed fair market value as compared to actual fair market value generally will decrease during the two-year period that the assessment is effective, especially when market values continue to increase.
Board of Equalization
The Board of Equalization for the City of Martinsville is comprised of 5 members who are appointed by the Circuit Court Judge. The responsibility of the Board of Equalization is to hear and give consideration to assessment appeals and equalize the assessment if it is determined that the property has been improperly valued. The burden of proof is upon the taxpayer who appeals his assessment to the Board of Equalization that his assessment value should be adjusted by demonstrating that it has not been valued equitably with similar properties.
Applications to appeal an assessment before the Board of Equalization must be made by April 3, 2017 by the real property owner or his agent. The Board of Equalization must complete its review and equalization process by May 15, 2017. To obtain an appeal application and schedule a hearing time before the Board of Equalization contact the Commissioner of the Revenue office at 276-403-5130.
Assessment Appeal Process
Reassessment notices are sent in early January 2017 to the property owner of record. The assessor's review period was scheduled for January 17 through February 28, 2017, to give consideration to complaints and concerns regarding the reassessment.
Upon completion of the review period held by the assessors, the Board of Equalization heard appeals that are filed by the April 3, 2017 deadline. The purpose of the hearings is for the Board of Equalization to equalize real estate assessments for which the owner may have a complaint. Applications for a hearing before the Board of Equalization may be obtained by contacting the real estate division of the Commissioner of the Revenue office at 276-403-5129 and must be filed by the April 3rd deadline.
By City Ordinance, the Board of Equalization must complete its work by May 15th. Once the Board of Equalization completes its work, the reassessment is final. The City Council uses the reassessment values to determine the tax rate necessary for generating revenue from real property.
Any taxpayer who fails to take advantage of the review period with the Assessors or the appeal process before the Board of Equalization may appeal to the Circuit Court. (See appeal options) In all instances, the burden is on the taxpayer to prove that his assessment should be adjusted by demonstrating that his property has not been valued equitably with similar properties.
The Martinsville City Council establishes all tax rates for local taxation as part of it annual budget process. The reassessment values are utilized as part of the budget process by City Council to determine the tax rate necessary for generating revenue from real property. Public hearings to discuss the tax rates are publicized in the Martinsville Bulletin 10 days prior to the hearing date.
The assessing officials have no authority in establishing the tax rate; their responsibility is to equitably assess a fair market value to all properties within the City of Martinsville. When the tax rate is applied to equitably assessed properties, property owners can be assured that they are only being asked to pay their fair share of the cost of providing services such as schools, police and fire protection.
State law requires a public hearing on the tax rate to be established by City Council when the reassessed values would result in an increase of one percent or more of the total property tax levy from the previous year's levy. The tax rate established by City Council for fiscal year 2017-2018 is set at $1.0621 per $100 of assessed value for real estate. City Council adopted the real estate tax rate for FY 2018 on May 9, 2017.
Frequently Asked Questions
Q. If I don't agree with the assessor's assessed value of my property what can I do?
There are several appeal options available for taxpayers who feel that their opinion of the value of their property differs from the assessor's value. The burden of proof is on the taxpayer to show that the property is valued above fair market value. Contact the assessor to first review the factual data that the assessor has recorded for the property. Property information is available for public inspection in the Commissioner's office. Appeal applications can be downloaded for Commercial, Residential, or Vacant properties. For assistance, contact the assessors at 276.403.5336 or 276.403.5128.
Q. Why does my property value increase if I haven't done anything to it?
Many economic factors such as interest rates, inflation rates, housing supply and demand and tax law changes can affect the housing market and fair market value. Activity within the housing market will drive the property value. If homes similar to yours sell for higher prices, your home would bring a higher price if you offered it for sale on the open market. As property values change in the market place, those changes must be reflected in the locality's assessment books.
Q. Will my assessment go up if I keep my property well maintained?
Regular maintenance helps retain the value of your property, but generally does not increase the value of your property. However, if a combination of several of the following repairs or replacements are done at one time, the assessed value may increase:
- Exterior painting
- Gutter or downspout replacement
- Roof repair or replacement
- Window replacement
- Furnace replacement
- Porch or step repair
Q. Will my assessment increase if I make improvements to my property?
Typically, improvements that increase the market value of your property will increase the assessed value. Examples of these include:
- Adding rooms or garages
- Adding central air conditioning
- Extensive remodeling of kitchens and bathrooms
- Replacing old siding with aluminum or vinyl siding