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How Is My Assessment Determined?

Valuation in Massachusetts is valuation at "full and fair cash value," defined

as the amount a willing buyer would pay a willing seller on the open market. Assessors must collect, record and analyze a great deal of information about property and market characteristics in order to estimate the fair market value of all properties in their community. Properties such as churches and educational institutions are also valued even though they are exempt from taxation.

Assessors first inspect each property to record specific features of the land and building(s) that contribute to its value. Land size, location, view, building size, type and quality of construction, number of rooms, number of baths, number of fireplaces, type of heating system  all are examples of the data collected on each individual property before the valuation process can begin.

Finding the "market value" of a property involves discovering what similar properties are selling for, what the property would cost today to replace, and what financial factors, such as interest rates, may be affecting the real estate

market. Valuation techniques for commercial and industrial properties also include analysis from an investment point of view, since the purchase price the buyer is willing to pay depends, in part, on the return the buyer expects to receive.

The assessors do not create value. Rather, they have the legal responsibility to discover it and make sure that assessments reflect the changes occurring in the marketplace. People create property value by their transactions in the market. Since the assessments must be set at market value, rising real estate values will be reflected in generally higher assessed values. All properties, however, do not change in value to exactly the same degree. Many factors influence value, and the value of some properties may well increase more rapidly than others. The construction of a garage, or the addition of a room would increase the market value of the property and, therefore, also increase the assessed value.

The object of the valuation program is to estimate "full and fair cash value" as of January 1 (known as the "assessment date") prior to the fiscal year. The Town of Holden has accepted the Section 40 of Chapter 653 of the Acts of 1989 which allows communities to tax in the current fiscal year all new construction built between January 1 and June 30 of that year. The purpose of this local option legislation is to reduce the delay that can occur between construction and taxation. It allows the assessors to bring in revenue from new construction during the same year that the Town expends money to provide services for the property.