How Your Property Assessments Are Determined

By Sarah Dye

Article 15 of the Declaration of Rights in Maryland’s Constitution requires that all real property, unless specifically exempt, be assessed and taxed uniformly. Assessments are based on the fair market value of properties and are issued by the Maryland Department of Assessments and Taxation (DAT). In Maryland, real properties are assessed once every three years. In North Four Corners, our next property assessments will be released and mailed to us at the end of 2025.

During this year though, assessors (appraisers who estimate the value of property for tax purposes) will be determining the fair market values of our neighborhood properties. The amount of our future tax bills is determined by two values: (1) the assessed fair market value of our properties and (2) the property tax rate for Montgomery County. Figures can increase, decrease, or remain the same from year to year.

Assessors start with an estimate of construction costs if similar properties to our own are rebuilt today. Homes of similar style and quality of construction are considered, along with the number of stories within a structure. Assessors also factor in the size and quality of home improvements, type of heating/cooling systems, and whether or not areas such as the basement are finished.

Maryland law states that land and building components need to be part of every assessment. Once the value of the primary dwelling is estimated, assessors will calculate the estimate of land value and any other buildings present on a particular lot. A Neighborhood Adjustment Index is applied, using the depreciation and appreciation costs of similar properties. Then a final check, or statistical validation, is performed to make sure everything is correct. Proposed assessments are reviewed with recent home sales to make sure they are in line with market value.

It’s important to note that the DAT doesn’t set the residential real estate market, consumer demand does. The DAT fair market valuations follow the real estate market. Also, the DAT does not tax us, so it’s not worth discussing any taxing issues with the state assessment office. You may direct inquiries to Montgomery County. Additional information related to housing assessments can be found at the link below. ■

Housing Assessment Information