The Accuracy and Effect of Market Value Property Tax Assessments

Abstract

The State of Iowa requires tax assessed values to be equal to market value. [See Iowa Code 441.21.] The accuracy of assessed values relative to market values for individual properties, however, is a subject of much debate. The issue is the equity of a system of taxation in which the accuracy of the assessed value is affected by characteristics of the property. The purpose of this study is to examine the relative accuracy of assessed values of residential properties. Variables considered are the market value, the type of financing used by the last purchaser of each respective property, and the location of each property. (H71)