What Is Overassessment?

When a property's assessed value exceeds its actual market value, resulting in the homeowner paying more property tax than they should.

Detailed Explanation

Overassessment occurs when your county's estimated value of your property is higher than what it would actually sell for on the open market. It is far more common than most homeowners realize. Studies suggest that roughly 30% to 60% of residential properties are overassessed in any given year, depending on the market and county. Overassessment happens for several reasons. Mass appraisal models cannot account for every property's unique characteristics. Data errors in county records (wrong square footage, extra bedrooms, inaccurate lot size) inflate values. Rapidly changing markets leave assessments outdated, especially in declining neighborhoods where the county has not caught up. Physical issues like foundation problems, flood damage, or proximity to commercial nuisances are rarely captured. The consequences compound over time. An overassessment of $30,000 on a property in a state with a 2% effective tax rate costs $600 per year. Over five years, that is $3,000 in taxes you did not owe. Unlike a billing error you might catch immediately, overassessment quietly drains your finances year after year until you challenge it. The only way to correct an overassessment is to file an appeal. Counties do not proactively lower values for individual homeowners.

How It Varies by State

TexasEspecially common after rapid appreciation

Annual reassessment means CADs often raise values aggressively in hot markets. The 10% homestead cap can create distortions when market softens.

IllinoisCommon in Cook County triennial cycle

Properties in reassessment years may see large value jumps that overshoot market reality. Appeal rates in Cook County exceed 10% of all properties.

New JerseyHigh effective rates amplify overassessment cost

With the highest effective property tax rates in the nation (avg 2.23%), even small overassessments are expensive.

GeorgiaAnnual reassessment with 40% ratio

A $50,000 overestimate of market value translates to only $20,000 in assessed value, but at 1.0% effective rate still costs $200/year.

Common Misconceptions

Myth:If the county raises my assessment, they must be right

Reality:Counties use statistical models, not individual inspections. These models often lag behind market conditions or contain data errors. You have the legal right to challenge the result.

Myth:Only expensive homes get overassessed

Reality:Research from the University of Chicago shows that lower-value homes are disproportionately overassessed relative to their market value. Overassessment affects all price ranges.

Myth:Filing an appeal might cause the county to raise my value even higher

Reality:In most states, an appeal can only result in the assessment staying the same or going down. A few states technically allow increases, but this is extremely rare in practice.

Impact on Your Tax Bill

In New Jersey, if your home is worth $425,000 but the county has it assessed at $475,000 (a $50,000 overassessment), you are overpaying. At NJ's average effective rate of 2.23%, that $50,000 error costs you $1,115 per year. Over 5 years without an appeal, that is $5,575 in unnecessary taxes.

What Overassessment Really Costs Homeowners (The Math)

Is My Property Overassessed? How to Tell

Find out if your property is overassessed: the 3-minute test, 5 red flags, what overassessment costs you, and how to fix it with a property tax appeal.

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